Reserve Bank of Australia rejects 'scorched earth' policy to tame inflation with faster interest

Reserve Bank of Australia rejects 'scorched earth' policy to tame inflation with faster interest rate rises

Reserve Bank of Australia (RBA) deputy governor Michele Bullock has said the bank wants to hang on to as much of the employment gains made during the pandemic as it can, even as it tries to cool the economy to tame inflation.

Speaking at an Australian Business Economists dinner last night, Ms Bullock defended the bank's decision not to raise interest rates more sharply than it had, even though it is now not expecting inflation to fall back below the top of its 2-3-per-cent target range until 2025.

"We're very committed to get it back down to target, but we have a flexible inflation target, and we have a flexible inflation target for a reason," she told the gathered audience of economists, many of whom work for the big banks.

Read More: https://www.abc.net.au/news/2022-11-10/rba-rejects-scorched-earth-policy-to-tame-inflation/101639326