Inflation to be major challenge to Australian economy for up to two years

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Reserve Bank of Australia (RBA) Governor Michele Bullock said on Tuesday that inflation will be the major challenge for the economy over the next two years.

Key quotes

“Underlying demand was fueling part of the inflation challenge, and it was not entirely a supply-driven issue.”

“Says inflation is a crucial challenge in the next one or two years.”

“Says inflation is not only about supply issues, gasoline and rent, that there is still ongoing & underlying demand.”

“If inflation expectations adjust higher in response that’s a problem.”

“We haven’t had any productivity growth in Australia for a number of years.”

Market reaction

At the press time, the AUD/USD pair is losing 0.04% on the day to trade at 0.6558.