The Reserve Bank is likely to adopt a 'why wait' approach and raise interest rates further when it meets on Tuesday according to independent economist Warren Hogan.
The Reserve Bank is likely to adopt a"why wait" approach and raise interest rates further when it meets on Tuesday according to independent economist Warren Hogan.
"The sooner you do these things the less chance you have of getting behind the game, so I think tomorrow is as good a time as any if they're now sort of of the view they've got to get the rate up further." He also said persistent signs of"stickiness" in inflation figures was the main force driving RBA decision making."Inflation's not coming down enough, in fact it's showing signs of stickiness, and of course this all lends to the view that the cash rate has got to be higher."That's 85 per cent of the economy, that's what matters, and of course that's the inflation the RBA is worried about.
A lack of productivity growth is also cause for concern, with many experts adding that minimal improvements could delay rate relief until late 2024. He added that without substantive productivity growth, even four per cent wage growth would be"too high" for the RBA's target inflation rate.
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