The Reserve Bank has kept the cash rate at 4.35% for the fourth consecutive time. The decision follows a two-day board meeting.
In a statement released on Tuesday afternoon, the RBA board said the decision was driven by persistent inflation and a “highly uncertain” economic outlook.
RBA Governor Michele Bullock is expected to address media to discuss the board’s decision later this afternoon.
Reserve Bank cash rate decision
The RBA is Australia’s central bank. Its key responsibility is setting the ‘cash rate’ — an interest rate it charges commercial banks for short-term loans.
This rate influences the cost of borrowing across the economy, so changes to the cash rate are often called changes to ‘interest rates’.
The RBA has regularly raised interest rates over the last two years to fight historically high inflation (rising prices). The current cash rate is 4.35%. It was 0.10% at the start of 2022.
What happens next?
The Reserve Bank will next meet to determine the cash rate in six weeks.
It will be the first board meeting after the Government hands down the federal budget next week.
The board used to meet monthly but changed to a six-week schedule at the start of the year. It followed a review, which recommended fewer meetings to allow more time for the board to consider decisions and consult with staff.
