RBA's chief: policy setting appropriate for now

Published 11/25/2010, 06:00 PM
Updated 11/25/2010, 06:04 PM

SYDNEY, Nov 26 (Reuters) - Australia's central bank chief hinted on Friday there was no urgency to lift interest rates again, saying the overall policy setting was appropriate for the "period ahead".

The Reserve Bank of Australia (RBA) raised its official cash rate by 25 basis points to 4.75 percent early this month, with many commercial lenders raising their loan rates by even more.

"These moves have left the overall setting of monetary policy a little tighter than average, as judged by interest rate criteria," Governor Glenn Stevens told a parliamentary committee.

"Overall, and also taking account of the exchange rate, which has risen substantially this year, we judge this to be the appropriate setting for the period ahead," he added.

But Stevens said it was pretty clear the medium-term risks on inflation lay in the direction of it being too high rather than too low, suggesting the RBA was not done tightening yet. (Reporting by Ian Chua; Editing by Mark Bendeich)

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