Subject: Statement by the Monetary Policy Board: Monetary Policy Decision

⚡️ Highlights:

1. The Board decided to increase the cash rate target by 25 basis points to 3.85 per cent due to a substantial increase in inflation since the second half of 2025.

2. Strong growth in private demand, driven by household spending and investment, has led to greater capacity pressures in the economy.

3. Labour market conditions remain tight, with low unemployment rates and high unit labour costs, despite a slight easing in the Wage Price Index growth.

4. Uncertainties in the domestic and global economy could further add to capacity pressures, leading to potential risks to inflation and economic growth.

5. The Board will continue to closely monitor data and assess risks to guide future decisions, with a focus on achieving price stability and full employment. Today's policy decision to increase the cash rate target was unanimous.

✍️ Reserve Bank of Australia | Full Article

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