The Reserve Bank of Australia (RBA) has decided to keep interest rates unchanged at 3.6 percent, following a series of three cuts earlier this year from a pre-February peak of 4.35 percent.
RBA Chief Economist Sarah Hunter told a parliamentary committee that Australia’s economy appears to be in a “cyclical upswing.” Recent monthly inflation data came in higher than expected at 3 percent, with particular concern over rising services inflation.
In its post-meeting statement, the RBA Monetary Policy Board cited recovering private demand, persistent inflation in some sectors, and overall stable labor market conditions as reasons for maintaining the current cash rate.
August private sector credit figures from the Australian Bureau of Statistics showed annual loan growth at 7.2 percent, the fastest pace since the global financial crisis outside of the pandemic period. Economists Tom Ryan and Ben Jarman of JP Morgan noted that strong credit growth should continue to support housing, business investment, and private consumption.
