Reserve Bank Governor Michele Bullock has indicated that while trimmed mean inflation is expected to decrease further in the June quarter on a year-ended basis, recent monthly CPI data suggests the decline might not be as significant as initially projected in May. Bullock emphasised that the RBA is closely monitoring upcoming data to confirm the expected gradual decline of inflation towards 2.5 per cent. She made these remarks in a speech delivered in Sydney on Thursday.
Bullock acknowledged the encouraging resilience of the labour market amid slowing inflation, with the unemployment rate remaining relatively low. Since February, the Reserve Bank has reduced the cash rate by 50 basis points. The board continues to advocate for a measured and gradual approach to easing monetary policy, aiming to balance inflation control with preserving employment gains.
She explained that this strategy meant interest rates in Australia did not need to increase as sharply as in some other economies, potentially mitigating the need for substantial rate cuts moving forward. Bullock recognised the ongoing cost-of-living pressures faced by Australians, highlighting the importance of maintaining low and stable inflation to support households, jobs, communities, and the overall economy.
“We still think it will show inflation declining slowly towards 2.5 per cent, but we are looking for data to support this expectation,” Bullock said. The Reserve Bank of Australia (RBA) is the nation’s central bank. It conducts monetary policy and oversees the stability of the financial system.
