RBA Unmoved by Latest Inflation Figures, Holds Cash Rate Steady

RBA says current forecasts do not predict inflation returning sustainably to the target midpoint of 2.5 percent until 2026.

A man walks past the Reserve Bank of Australia in the central business district of Sydney on June 7, 2022. - Australia's central bank raised interest rates by a higher-than-expected half percentage point on June 7 and warned of more increases, trying to rein in "significantly" increased inflation. (Photo by Muhammad FAROOQ / AFP) Photo by MUHAMMAD FAROOQ/AFP via Getty Images

Despite government rejoicing over the 2.8 percent inflation rate milestone, the Reserve Bank of Australia (RBA) continues to signal caution.

In its latest review on Nov. 5, the RBA decided to keep the cash rate target unchanged at 4.35 percent and the interest rate on Exchange Settlement balances steady at 4.25 percent, indicating concerns over underlying inflationary pressures that persist despite a notable CPI decline.