RBA minutes show unanimous 25bp hike to 4.60%, further increases possible

The Reserve Bank of Australia flagged a growing risk that inflation stays stubbornly high, according to minutes of its September monetary policy meeting published Tuesday. The account of the meeting showed board members voted unanimously to lift the benchmark interest rate by 25 basis points to 4.60%. Officials also left the door open to additional tightening should conditions warrant it.

The minutes stated that the board would stay focused on its mandate to deliver price stability and full employment, and would keep doing what it considers necessary to reach that outcome, including raising the cash rate target further if required. The language suggests the central bank is not yet ready to declare the inflation fight over.

The unanimous vote indicates broad agreement among policymakers on the direction of policy at the September gathering. The release of the minutes gives markets a fuller picture of how the board weighed the inflation outlook against other economic considerations at that meeting.

The Australian decision landed against a backdrop of hawkish messaging from other major central banks. According to Breaking The News, International Monetary Fund Managing Director Kristalina Georgieva said central banks should maintain a prudent hawkish stance and described recent rate moves by the United States Federal Reserve, the European Central Bank and the Bank of Japan as appropriate.

Georgieva also warned that global public debt is approaching its highest level since World War II and is set to surpass 100% of gross domestic product, with advanced economies the worst offenders, urging governments to cut borrowing. Those comments underscore the wider pressure on policymakers balancing inflation control with fiscal and growth risks.

With the minutes now public, attention shifts to incoming Australian inflation and employment data that will shape whether the RBA follows through with another increase. The board's stated readiness to act further keeps the possibility of additional tightening on the table.