Lowe Outlines Cash Rate Outlook

"As part of the Board's overall strategy, it will not increase the cash rate until inflation is sustainably within the 2–3 per cent target range. Year-ended CPI inflation will temporarily spike in the June quarter to around 3½ per cent due to the unwinding of some pandemic-related price reductions. There have also been price increases for some items due to pandemic-related interruptions to supply. But beyond this, inflation pressures remain subdued and are likely to remain so. For inflation to be sustainably in the 2–3 per cent range, wage increases will need to be materially higher than they have been recently. Partly for the reasons I talked about earlier, this still seems some way off."