The Reserve Bank of Australia lifted the official interest rate by 25 basis points to 3.60% as it continues its fight to reduce inflation.

The decision was in line with market expectations, as the RBA had recently signaled it intended to make at least two more interest rate rises in the coming months.

The RBA said it expects “further tightening of monetary policy will be needed to ensure that inflation returns to target and that this period of high inflation is only temporary”. This signals a change from last month when the central bank flagged there would need to be “further increases in interest rates … over the months ahead”.
The market expects the cash rate to come down in late 2023 or in 2024. The latest economic data is giving economists hope that the RBA will pause rate rises soon. GDP growth was 0.5% in the December quarter, below the expectation of 0.8%. The recent inflation data suggests it may have peaked at 8.4% last December.
With so much uncertainty about interest rates, it can help to talk to an expert.