Fourth rate hike from the Reserve Bank of Australia

The Reserve Bank of Australia (RBA) has raised its policy rate to 1.85 percent. This is the bank’s fourth rate hike since May. The Reserve Bank of Australia has raised its policy rate by 50 basis points to 1.85 percent. Although the central bank stated that the path of monetary policy has not been determined in advance, it indicated that interest rate hikes will continue. Economists who participated in a Bloomberg survey also expected a 50 basis point increase. In a statement made after the August policy meeting, the central bank stated that the rate hike was another step in the “normalization” policy, referring to the previously stated ending of “extraordinary” policies to support the economy. In a statement made after the meeting, Reserve Bank of Australia Governor Philip Lowe said: “Today’s increase in interest rates is the next step in the normalization of monetary conditions in Australia. The increase in interest rates in recent months has been necessary to bring inflation back to target and create a more sustainable balance of demand and supply in the Australian economy.” “The Board expects to take further steps in the process of normalising monetary conditions in the coming months, but it is not on a pre-determined path. The size and timing of future interest rate increases will be guided by incoming data and the Board’s assessment of the inflation and labour market outlook. The Board is committed to doing what is necessary to ensure inflation in Australia returns to target over time,” Lowe added.