RBA Holds Cash Rate at 4.35% as Oil-Driven Inflation Stays Too High
Updated
Updated · Reserve Bank of Australia · Jun 16
RBA Holds Cash Rate at 4.35% as Oil-Driven Inflation Stays Too High
3 articles · Updated · Reserve Bank of Australia · Jun 16
Summary
The Monetary Policy Board unanimously left Australia’s cash rate target at 4.35%, saying inflation will likely stay elevated for some time.
Three rate hikes since the start of 2026 have already tightened financial conditions, and the board said it wants to gauge their effect alongside the global oil supply disruption.
Higher fuel costs are feeding into broader prices, while capacity pressures from late 2025 persist; short-term inflation expectations have eased but remain above earlier-2026 levels.
Consumer spending is slowing and housing prices are falling in some capital cities, but business investment remains strong and labor-market indicators outside April unemployment have been more resilient.
The RBA said Middle East conflict risks still cloud the outlook and signaled it could raise rates again if inflation threatens to become embedded.