SINCE 1997

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Inflation finally forces the RBA's hand

A headline inflation rate above 5 per cent was the catalyst for the Reserve Bank of Australia to finally lift interest rates for the first time in more than 11 years.

Reserve Bank of Australia's Governor, Philip Lowe, stands beside a large bank vault
Reserve Bank Governor Philip Lowe has at last unlocked the RBA's tool to tackle inflation.

A headline inflation rate above 5 per cent was the catalyst for the Reserve Bank of Australia (RBA) to finally lift interest rates, for the first time in more than 11 years.

Attributing the sudden burst of inflation above the RBA’s preferred 2-3 per cent band to international factors, RBA Governor Philip Lowe made it clear the Board was expecting to raise rates multiple times over the next couple of years to keep inflation in check.

“The centra…