RBA: Will not hike OCR until actual inflation is sustainably within the 2 to 3% target range

Will not increase the cash rate until actual inflation is sustainably within the 2 to 3 per cent target range

Central forecast is for GDP growth of 3 percent over 2021 and 5½ per cent and 2½ per cent over the following two years.

This will require the labour market to be tight enough to generate wages growth that is materially higher than it is currently

One important source of uncertainty continues to be the possibility of a further setback on the health front

Board is prepared to be patient, with the central forecast being for underlying inflation to be no higher than 2½ per cent at the end of 2023 and for only a gradual increase in wages growth

Central forecast is for the unemployment rate to trend lower over the next couple of years, reaching 4¼ per cent at the end of 2022 and 4 per cent at the end of 2023.

Inflation has picked up, but in underlying terms is still low, at 2.1 per cent.

While inflation has picked up, it remains low in underlying terms

Further, but only gradual, pick-up in underlying inflation is expected

Decision to discontinue the yield target reflects the improvement in the economy and the earlier-than-expected progress towards the inflation target

Central forecast is for underlying inflation of around 2¼ per cent over 2021 and 2022 and 2½ per cent over 2023.

Wage price index forecast to increase by 2½ per cent over 2022 and 3 per cent over 2023.

Bank welcomes APRA's recent decision to increase the interest rate serviceability buffer on home loans.