The Reserve Bank of Australia has delivered its third rise in official interest rates for the year, taking the cash rate up another 0.25 percentage points to 4.35%, and thereby completely reversing the cuts of 2025.

While some make take comfort from the RBA Governor’s words in her post-decision press conference that indicated that we could now expect a pause in rate hikes for at least a little while, her overall responses to questions from the media were surprisingly blunt, as well as fairly alarming regarding the economic outlook.

In previous press conferences, Bullock has been at pains to try not to say anything much at all, especially anything that could possibly be construed as “forward guidance”. In plain language, this means giving absolutely no hints whatsoever on where the RBA itself thinks rates could and should be going, so typically results in dancing around questions from the media.

On Tuesday, in contrast, she used very clear language to deliver three key messages.

Firstly, that the Board feels that the three rate rises this year are enough to knock the pre-war domestic inflationary pressures on the head. With monetary policy now considered “a bit restrictive”, according to the governor, headline inflation is expected to peak at 4.8%........

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