Australia hikes rates to 18-year high to fight inflation

Michele Bullock, governor of the Reserve Bank of Australia (RBA), during a news conference at the central bank's head office in Sydney, Australia, on Tuesday, May 5, 2026. Australia's central bank raised its key interest rate for a third consecutive meeting, underscoring its determination to tame stubbornly strong inflation and cementing its outlier status among global counterparts. Photographer: Brendon Thorne/Bloomberg via Getty ImagesBloomberg | Bloomberg | Getty ImagesAustralia's central bank raised its benchmark cash rate by 25 basis points to 4.85% on Tuesday, the highest level since November 2008.The Reserve Bank of Australia's move was in line with expectations from economists polled by Reuters, and marked its fifth rate increase this year.In its statement, the RBA said that the move was a split decision, with six members voting for the increase and three opting for a hold. This also comes as the country continues to grapple with high inflation, with the consumer price index rising 4.3% in September, up from 4% in August and marking its highest level since March.The central bank also said inflation is now expected to "remain elevated through much of 2027," and not expected ...