MNI BRIEF: RBA Revises Return To 2-3% Target

The Reserve Bank of Australia has brought forward when it expects to return inflation to within its 2-3% target band, noting within its Statement on Monetary Policy the consumer price index should reach 2.8% y/y by the end of Q4 2025 from its previous 3% prediction.

The Reserve board held the cash rate steady today at 4.35% for the third consecutive meeting. In the accompanying statement, the board maintained tightening language, noting "the Board expects that it will be some time yet before inflation is sustainably in the target range" and "a further increase in interest rates cannot be ruled out."

MNI had reported the RBA would likely revise its forecasts following recent CPI results. (See MNI RBA WATCH: Board Likely To Hold Cash Rate At 4.35%) The Reserve also slightly adjusted its unemployment expectation to 4.4% by Q4 from the previous 4.25% assumption.

Governor Michele Bullock will present the board’s finding at a press conference at 1530 AEDT.