“If monetary policy is eased too much too soon, disinflation could stall, and inflation would settle above the midpoint of the target range,” the rate-setting board said. “In removing a little of the policy restrictiveness in its decision today, the Board acknowledges that progress has been made but is cautious about the outlook.”
Australia’s central bank cut interest rates for the first time since 2020 as inflation approaches the top of its 2%-3% target, while signalling a cautious approach to any further easing.
The Reserve Bank lowered its cash rate by a quarter-percentage point to 4.1% on Tuesday, in a widely expected decision.
