In her remarks to the House of Representatives’ economics committee, RBA Governor Michele Bullock emphasized the careful balancing act in managing inflation while minimizing harm to the labor market. Bullock reiterated that the Board believes current monetary policy is “sufficiently restrictive” to bring inflation down over a reasonable timeframe without causing undue damage to employment.
Despite financial markets anticipating a rate cut by the end of the year, Bullock was clear in her message that it is “premature to be thinking about rate cuts” at this stage. She pointed out that inflation remains too high and, in underlying terms, is not expected to fall back within the target range until the end of next year.
While acknowledging that economic circumstances could change, Bullock firmly stated that, based on the current outlook, the Board “does not expect that it will be in a position to cut rates in the near term.”
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