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Australia's central bank raised its inflation and economic growth forecasts, stoking expectations it will increase interest rates for a third time this year.
Core inflation will be 3 percent over the next two years, the Reserve Bank of Australia said in a quarterly statement on monetary policy, released in Sydney today. That's at the top of the bank's target range and exceeds the previous 2.75 percent forecast.
The Reserve Bank raised the benchmark interest rate to a 5 1/2- year high 6 percent this week, and today said resurgent consumer spending, rising wages and record commodity prices are fueling inflation and growth in the Asia-Pacific region's fifth-largest economy. Central banks worldwide are raising interest rates and the global economy will grow above its average rate next year, it said.
The inflation forecast is at the top of the bank's range, and the bank is suggesting the domestic economy is accelerating.'' |
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