Reserve Bank of Australia

The Reserve Bank of Australia (RBA) is Australia's central bank, responsible for maintaining price stability and full employment. It's currently newsworthy due to its recent decisions to increase the official cash rate in response to rising inflation, driven partly by global energy shocks and geopolitical events like the war in the Middle East. These rate hikes, intended to curb inflation, are impacting Australian households already struggling with soaring petrol prices and increased cost-of-living pressures. Economists predict further rate increases. The RBA's actions are controversial, with some questioning whether raising borrowing costs during a global energy crisis is the right approach, and a minority of the rate-setting board dissenting. The RBA's decisions are significant because they directly affect mortgage holders, consumer spending, and the overall risk of recession in Australia.