Australia Raises Key Rate By 25 Bps

(RTTNews) - The Reserve Bank of Australia raised its benchmark rate for the second straight time, citing material risk that inflation will remain above target for longer than anticipated.

The policy board, governed by Michele Bullock, decided to hike the cash rate target by 25 basis points to 4.10 percent.

The decision was made by a majority vote, with five members voting to raise the rate and four seeking to leave it unchanged at 3.85 percent.

This follows the RBA's previous 25-basis-point hike in February, which was the first increase since November 2023.

Policymakers noted that the conflict in the Middle East has resulted in sharply higher fuel prices, which, if sustained, will add to inflation.

"…the Board judged that there is a material risk that inflation will remain above target for longer than previously anticipated," the bank said in a statement.