RBA Lowe: Case for doing that becomes stronger as the level of interest rates increases

The Reserve Bank of Australia's Phillip Lowe testifies and says:

''Now that inflation is as high as it is, we need to make sure that inflation returns to target in a reasonable time.''
    
''Inflation has very quickly gone from being too low to being too high.''
   
''RBA will do what is necessary to make sure that higher inflation does not become entrenched.''
    
''Seeking to do this in a way that keeps the economy on an even keel.''
    
''Medium-term inflation expectations have remained well anchored.''
    
''Growth in labour costs remains consistent with inflation returning to target.''
    
''It is understandable that some people are questioning whether or not too much support was provided by RBA over the past two years.''
    
''Board expects that further increases will be required to bring inflation back to target. we are not on a pre-set path.''
    
''At some point, it will be appropriate to slow the rate of increase in interest rates.''
    
''Case for doing that becomes stronger as the level of interest rates increases.''
    
''RBA board judged during peak of covid pandemic that the bigger policy mistake would have been to do too little, rather than too much.''
    
''Board and the bank's staff welcome RBA review and we have already had constructive discussions with the review panel.''

Meanwhile, the Australian dollar continues to weaken against the greenback, failing to recover after Tuesday’s hot US inflation report spurred expectations that the US Federal Reserve might tighten even 100 bps in September’s monetary policy meeting. At the time of writing the pair is down 0.16% at 0.6690.