Are rate rises the only way to stop inflation?
Grattan Institute
00:00
The Impact of Interest Rates on Inflation
Mortgage holders across the country are kind of really concerned every time the cash rate goes up. Why and how do you hire interest rates impact inflation? It's a fair question because it does seem a little bit counterintuitive. The RBA aims for 2% to 3% inflation on average over the median term while also considering what's going on in the labor market. These interest rates affect aggregate demand and therefore employment across the economy.
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