Reserve Bank of Australia (RBA) Governor Philip Lowe speaks on the economic outlook and monetary policy at the Anika Foundation fundraiser in Sydney.
Further rate hikes will be necessary, but not on a predefined trajectory.
Aware of the lags in the functioning of monetary policy and that rates have increased very rapidly.
The case for slowing the pace of rate hikes grows stronger as the level of the spot rate rises.
But how high rates need to go and how fast will be guided by the data, the inflation outlook and the labor market.
Price stability necessary for a strong economy, full and sustainable employment.
A sharp global slowdown would make a soft landing in Australia more difficult.
Recent data continues to suggest resilience in Australian consumer spending.
Inflation expectations remain in line with the inflation target.
A rise in inflation expectations will require higher interest rates.
In our national interest, we avoid this change.
Overall wage growth has yet to respond significantly to rising inflation.
Flexible inflation targeting has served Australia well and remains the best monetary policy regime.
I see no solid arguments for moving away from this broad approach.
It is worth considering the arguments for and against changing the target range from 2 to 3%.
It is important that we learn from our errors in forecasting inflation.
Less hawkish comments from RBA Governor Lowe do not bode well for the Australian dollar as AUD/USD extends losses below 0.6750.
The pair was last seen at 0.6730, down 0.55% on a daily basis. Trade headlines between the United States and China are also weighing negatively on the antipodes.