Central bank of Australia states that slowdown of hikes might happen at a certain stage

Central bank of Australia is planning another round of raising interest rates to hold down extreme inflation, while it also notes some premises of a possibility to slow down the pace of rate hiking as some policy settings reached the levels closer to regular ones.

According to minutes of the Board meeting of the Reserve Bank of Australia (RBA) held in September, it was confirmed that policy doesn’t go along a previously determined path, and there would be attempts to balance it and keep the economy in a state of equilibrium.

As it was decided at the meeting held on September 6, the interest rate was increased by 50 basis points and reached the level of 2.35%. This raising was the fifth one over several months, with a total volume of rate increasing being of 225 basis points.

Markets are currently expecting another interest rate hike to occur in October, forecasting the rates to be increased by half a point. These projections are based on the belief that the RBA will try to keep up with the Federal Reserve System of the U.S., which is suggested to raise its rates by 75 basis points during the current week.

Philip Lowe, governor of the RBA, has said that a possible slowdown might happen in the future at some stage, although he emphasized the necessity to keep the inflation expectations under the circumstances of a tightened labor market.