Arabic version: أستراليا ترفع سعر النقد إلى 4.85%

According to Cnbc, Australia’s central bank raised its benchmark cash rate by 25 basis points to 4.85% on Tuesday, its highest level since November 2008. The increase was the Reserve Bank of Australia’s fifth this year and was in line with expectations from economists polled by Reuters.

The decision was split, with six RBA members voting to raise rates and three preferring to hold them unchanged. The move comes as Australia continues to face high inflation: the consumer price index rose 4.3% in September, from 4% in August, reaching its highest level since March.

The RBA upgraded its inflation projections, saying inflation is expected to remain elevated through much of 2027 and is not forecast to return to its 2%-3% target range until late 2027. That timing is three quarters later than previously forecast. The bank cited higher fuel and other commodity prices, as well as AI-related investment that is driving rapid price growth for technology-related goods.

RBA Governor Michelle Bullock said in the bank’s September decision that inflation was “too high,” pointing to higher oil prices from the Iran War and stronger domestic spending. She said upside risks to inflation were materializing and that further rate increases would come if needed. Economic growth has slowed, with GDP rising 2.1% in the June quarter from a year earlier, compared with 2.5% in the March quarter. Bullock said a recession was “not our base case at the moment.”