Minutes: 25/50bp Hike Considered, Important To Maintain Anchored CPI Exp.

"In making their policy decision, members considered the possibility of raising interest rates by 25 basis points or 50 basis points. Members agreed that arguments for raising interest rates by 50 basis points were stronger. The level of interest rates was still very low for an economy with a tight labour market and facing a period of higher inflation. Members viewed it as important that inflation expectations remained well anchored and that the period of higher inflation be temporary. If medium-term inflation expectations were to adjust upward, the task of returning inflation to the target would be more difficult and would come at a higher cost in terms of activity and employment. Members noted that, while short-term inflation expectations had risen with actual inflation, longer-term measures of inflation expectations were well anchored."

• "Members agreed that further steps would need to be taken to normalise monetary conditions in Australia over the months ahead. The size and timing of future interest rate increases will continue to be guided by the incoming data and the Board's assessment of the outlook for inflation and the labour market, including the risks to the outlook. The Board remains committed to doing what is necessary to ensure that inflation in Australia returns to the target over time."