Elevated Business Profit Margins Could Worsen Inflation: Reserve Bank of Australia Governor Warns

Reserve Bank of Australia Governor Philip Lowe sits at a table for a parliamentary economics committee hearing in Sydney, Australia, on Sept. 22, 2016. Peter Parks/AFP via Getty Images

The governor of the Reserve Bank of Australia (RBA) has warned local businesses not to drive up inflation by raising their margins too much.

During a parliamentary hearing on Sept. 16, which looked into the central bank’s recent interest rate decisions, RBA governor Philip Lowe said that increased profit margins could be a major contributor to inflation.