The Governor of the Reserve Bank of Australia stated that if inflation remains stubbornly high, further interest rate hikes cannot be ruled out.

Reserve Bank of Australia Governor Michele Bullock has stated that if the facts prove that inflation remains persistently high, the central bank does not rule out further interest rate hikes. She also emphasized that the Monetary Policy Committee is currently still cautious and has not yet made a decision on whether further policy tightening is needed. Bullock told senators in Canberra on Thursday that an inflation rate above 3% is unacceptable. Her statement echoes the warning from Deputy Governor Andrew Hauser yesterday: that high inflation is still a major challenge for decision-makers. The Reserve Bank of Australia raised interest rates last week, becoming the first major central bank to hike rates this year. The latest economic forecasts released alongside the interest rate decision suggest that there will be at least one more rate hike in the coming months. The RBA currently predicts that both overall inflation and core inflation will be above the upper limit of its 2%-3% target range this year. Bullock stated that the Monetary Policy Committee will base its decisions on data and will continue to review forecasts in the future, with further interest rate hikes if inflation does indeed solidify.