Australia central bank keeps rates at 3.6%, warns of inflation risk

SYDNEY: Australia’s central bank on Tuesday left its cash rate steady as expected at 3.60%, saying risks to inflation had tilted to the upside and it would take a little longer to asses the persistence of price pressures.

Wrapping up a two-day policy meeting, the Reserve Bank of Australia (RBA) also said domestic demand had been stronger than expected and could add to inflationary pressures.

Markets had seen no chance of an easing this week following strong readings on inflation and consumer demand, and were already pricing in the risk of a rate hike later next year.