RBA Says Inflation Is Too High as Confidence Readings Slump

Australia’s inflation remains too high and interest rates will need to be set at a level consistent with returning it to the 2–3% target, Reserve Bank Deputy Governor Andrew Hauser said, as a surge in energy prices tied to the Iran war sent consumer and business confidence tumbling.

Speaking at an event in New York, the RBA’s No.2 official described the spike in oil as a significant income shock for Australia and warned policymakers are alert to the risk that medium- and long-term inflation expectations could begin to drift higher.