Dr Brendan Rynne, KPMG Chief Economist, responds to the RBA’s announcement

KPMG remains of the view the central bank will hold off raising rates until after the election.

Despite Omicron surging through the community during the summer holiday period Australia’s unemployment rate was maintained at a near-record low of 4.2 percent.

QE program to end and strong words by the Governor about keeping interest rates unchanged until inflation is sustainably in its target range, but KPMG still consider the start of tightening cycle is likely to commence towards the end of 2022.

Inflation figures are now at their highest since 2014, which will add to pressure on the RBA to change its monetary policy course.

The RBA’s outlook is unchanged. It continues to view inflation as well contained and driven by temporary factors.

Dr Brendan Rynne, KPMG Chief Economist comments on today’s interest rate announcement.

The RBA Board has announced it will continue with highly accommodative monetary policy settings in the near term, albeit with a couple of the monetary policy levers notched back a step.

Even with the current surge in house prices, the RBA has not changed the cash rate today – no surprise, given it has been signalling rates could stay at historically low levels until 2024.