Bullock tells parliament the RBA has raised 75 basis points this year
Victoria Shinder2 min readReserve Bank of Australia Governor Michele Bullock gave her opening statement to the House of Representatives Standing Committee on Economics in Canberra on 18 September. Since the committee's previous hearing in February, she said, the Monetary Policy Board has raised the cash rate target by 50 basis points, taking the increase this year to 75 basis points.
Inflation fell from a 7.9 percent peak at the end of 2022 to within the 2 to 3 percent target range during 2024 and 2025, but picked up in the second half of 2025. Over the past year headline and underlying measures have been around or a little above 3.5 percent. Bullock attributed this partly to capacity pressures at home and partly to the Middle East conflict, which raised petrol prices directly and other prices as firms passed on fuel costs. Unemployment is 4.5 percent.
The August forecasts had inflation returning to around the midpoint of the target range only in late 2027, with risks skewed to the upside. Since then, she said, growth has been slowing but some of those upside risks appear to be materialising: oil prices have risen sharply again, and the AI boom and extreme weather are pushing up energy, agricultural and technology-related prices. If higher costs become embedded in price and wage setting, inflation could prove more persistent and require a stronger policy response. Housing prices have fallen in most capital cities but remain around 50 percent above early 2020, and she said monetary policy does not target them.
The board was due to meet just over a week after the statement. A key question, Bullock said, is whether the tightening to date will be enough to bring inflation back to target in a reasonable time.
What it means
The statement frames the next decisions around one test, whether 75 basis points is enough, and lists more reasons to fear it is not than that it is. Australia's experience also shows how a country already hiking meets an energy shock: the question is no longer whether to tighten but how much further.