RBA Governor Bullock Questions Sufficiency of Current Tightening, Signals Readiness for Further Hikes

• RBA Governor Bullock questions if current tightening is enough to curb inflation.
• RBA Board remains ready to raise rates further if needed.
• Economy adjusting as expected, but policy lags mean full effects are pending.

Reserve Bank of Australia (RBA) Governor Michele Bullock stated on Tuesday in Sydney that a key question for the central bank is whether the monetary tightening already implemented is sufficient to bring inflation down. While acknowledging signs that the economy is adjusting broadly as anticipated, Governor Bullock emphasized that the full effects of this year’s rate increases are yet to be felt due to policy lags. She indicated the RBA Board remains prepared to raise the cash rate further if necessary to achieve its goal of low, stable inflation. Bullock also noted that further easing in both demand growth and the labor market would likely be required to achieve this objective.