The Australian central bank hiked interest rates to a 10-year high in its final policy decision of 2022, as widely expected, and said more hikes are still needed in the future as policymakers aim to combat inflation.
The Reserve Bank of Australia (RBA) lifted the cash rate by 25 basis points to a 10-year high of 3.1%, the eighth hike in as many months, as it concluded its December policy meeting.
“The Board expects to increase interest rates further over the period ahead, but it is not on a pre-set course,” Philip Lowe, its Governor said in a statement.
“The size and timing of future interest rate increases will continue to be determined by the incoming data and the Board’s assessment of the outlook for inflation and the labor market.” he said.
The local dollar edged up slightly to US$0.6729, after the policy decision was released, the markets had nudged up the expected interest rate hike of 3.6 per cent by next July, up from 3.5 per cent before the decision.