Reserve Bank of Australia Governor Lowe (Headlines via Reuters):
- says plausible the cash rate will be increased later this year
- closer to point where inflation sustainably in target range, but not there yet
- says moving too early on rate rise carries risks to achieving full employment
- says will do what is necessary to maintain low and stable inflation
- says we have scope to wait and assess incoming information on inflation and wages
- watching how war in Ukraine adds to supply-side inflation pressures
- extended period of high inflation could feed through to inflation expectations, wages
- current evidence shows most wage rises still under 3%, pick up still gradual
- sees strong growth in hours worked, jobs over the months ahead
- says data suggests economy growing despite floods, omicron outbreak
- says war in Ukraine a new major downside risk to the global economy
- says main economic effects of war stem largely from higher commodity prices
- Australia to benefit from higher terms of trade, but extra income likely to be saved
This from Lowe has wider applicability than just the RBA IMO:
- "I recognise that there is a risk to waiting too long, especially in a world with overlapping supply shocks and a high headline inflation rate. But there is also a risk of moving too early. "
more to come
