key interest rate to 3.1%

Australia's Central Bank Raises Key Interest Rate to 3,1%

7 December 2022 03:27

Australia's Central Bank has raised its benchmark interest rate by a quarter point to 3.1% as it continues trying to wrestle down inflation. The increase was the bank's eighth in a row and took the rate to its highest level in 10 years.

Still, Australia's rate hikes have remained relatively modest and its key rate remains, lower than in many other countries, including the united states, where the federal reserve has raised its key interest rate to a range of 3.75% to 4%.

Reserve bank of Australia governor Philip Lowe said inflation remained too high at 6.9%. That's well above the bank's target inflation rate of between 2% and 3%. The bank noted the labor market remains tight with unemployment at 3.4% in October the lowest rate since 1974 and many firms struggling to hire workers.