Australia Interest Rate

The Reserve Bank of Australia (RBA) retained its cash rate at 4.35% during its final meeting of 2024, keeping borrowing costs unchanged for the ninth straight gathering, in line with market forecasts. The central bank stated that while headline inflation has eased substantially and will remain lower for some time, underlying inflation stays too high before reaching the midpoint of 2 to 3% in 2026. The board said it gained some confidence that inflation is moving sustainably towards the target. Meanwhile, other recent data on activity have been mixed but remain consistent with forecasts. On household consumption, any pick-up may be slower than expected, resulting in continued subdued output growth and a sharper deterioration in the labor market. The RBA added that it will continue to rely upon data and the evolving assessment of risks, including geopolitical uncertainties, to guide its decisions. The committee also maintained the interest rate on Exchange Settlement balances at 4.25%.