RBA Maintains Rate, Cites Inflation Concerns

The Reserve Bank of Australia (RBA) has maintained interest rates at 4.35%, with Governor Michele Bullock indicating confidence that current rates are sufficient to reduce inflation without severely impacting the economy, despite persistent inflationary pressures. Bullock clarified that while headline inflation is expected to fall temporarily due to federal and state relief measures, underlying inflation remains a concern. Meanwhile, Bank of England Governor Andrew Bailey noted that UK interest rates are likely to gradually decline but will not return to near-zero levels, settling instead at a 'neutral rate.' Bailey's comments reflect a cautious approach to rate cuts, contrasting with the more aggressive rate cuts seen in the US.