The Reserve Bank of Australia governor Philip Lowe has confirmed interest rate increases.
In an address to the American Chamber of Commerce In Australia this morning, Lowe has called rate rises a necessity in making sure inflation returns to between 2-3 per cent.
“High inflation damages the economy, reduces the purchasing power of people’s incomes and devalues people’s savings,” Lowe said.
“It is also regressive, hurting most those who are least well equipped to protect themselves.
“Australians should be prepared for more interest rate increases. The level of interest rates is still very low for an economy with low unemployment and that is experiencing high inflation.”
Lowe was reticent to name a figure.
“How fast we increase interest rates, and how far we need to go, will be guided by the incoming data and the Board’s assessment of the outlook for inflation and the labour market.”
