Australian central bank boosts cash rate to 4.1% with 12th hike

Men walk down stairs to a train station in front of the Reserve Bank of Australia in Sydney, Tuesday, June 6, 2023. Australia’s central bank has lifted its benchmark interest rate for a 12th consecutive time to 4.1% and warned further rises could follow. (AP Photo/Rick Rycroft)

A woman walks out of the Reserve Bank of Australia in Sydney, Tuesday, June 6, 2023. Australia's central bank boosted the cash rate by a quarter of a percentage point to 4.1 percent, following a higher-than-expected 6.8% annual inflation rate for the March quarter. (AP Photo/Rick Rycroft)

CANBERRA, Australia: (AP) — Australia’s central bank on Tuesday lifted its benchmark interest rate for a 12th consecutive time, to 4.1%, and warned further rises could follow.

The Reserve Bank of Australia boosted the cash rate by a quarter of a percentage point at its latest monthly meeting. That followed a higher-than-expected 6.8% annual inflation rate reported for the January-March quarter.

Reserve Bank Governor Philip Lowe said it would take time for inflation to fall to the target range of 2% to 3%.

“This further increase in interest rates is to provide greater confidence that inflation will return to target within a reasonable timeframe,” Lowe said in a statement.

The cash rate is now at its highest level since April 2012.

The bank first started jacking up interest rates in June 2022.

Lowe said further increases might be needed.

“The board will continue to pay close attention to developments in the global economy, trends in household spending, and the outlook for inflation and the labor market,” he added.