The Reserve Bank of Australia (RBA) raised interest rates for the third time to 4.35%, defying global trends.

The Reserve Bank of Australia (RBA) raised its interest rate for the third time to 4.35%, reflecting its primary focus on controlling inflation, despite global economic uncertainty stemming from the Middle East conflict and soaring oil prices.

On May 5, 2569 at 11.32:XNUMX a.m., Bloomberg News reported that The Reserve Bank of Australia raised its policy interest rate for the third consecutive time. Reflecting a commitment to controlling persistently high inflation, the Monetary Policy Committee voted 8 to 1 to raise interest rates to 4.35% from 4.1%, while reiterating its readiness to take further policy measures as needed to maintain price stability and employment.

This decision makes Australia a country that is pursuing a policy contrary to other major central banks around the world, such as the US Federal Reserve and the Bank of Japan, which continue to delay raising interest rates amid uncertainty from the war in the Middle East.

Key factors suppressing inflation. คือ Energy prices soared due to the conflict between the United States and Iran. This has resulted in strain and partial blockades in the Strait of Hormuz, a shipping route for approximately 20% of the world's oil and liquefied natural gas, leading to a rapid rise in oil prices and increasing pressure on the cost of living for consumers.

While the Australian economy remains strong in some areas, such as a low unemployment rate of around 4.3% and total credit growth of 8.1%, consumer and business confidence have declined, and the manufacturing sector contracted for the third consecutive month in April.

The continued interest rate hikes are also putting pressure on the government ahead of the annual budget announcement, as the government is expected to introduce measures to alleviate the burden of living costs stemming from rising energy prices. However, a tight monetary policy could lead to slower economic growth and a potential increase in unemployment in the coming period.

The central bank expects core inflation to remain above its target range of 2–3% this year and next, potentially reaching 3.8% by mid-year, before gradually slowing to 3.1% in 2570 and returning to its long-term target of around 2.5% by the end of the same year. This reflects the challenges in controlling inflation amidst global economic volatility and geopolitical tensions.

refer : www.bloomberg.com

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