• For the first time in six months the Reserve Bank has elected to increase official interest rates, lifting the cash rate by 25 basis points to 4.75 per cent. While inflation is in the middle of the 2-3 per cent target band and economic indicators are decidedly mixed, the Reserve Bank believes that “inflation is likely to rise over the next few years.” This is clearly a pre-emptive strike against inflation.
• The Reserve Bank Board “concluded that the balance of risks had shifted to the point where an early, modest tightening of monetary policy was prudent.”

Click here to download document (pdf)

The post Reserve Bank takes a punt appeared first on AdviserVoice.