In their appearance before the House economics committee on Friday, the executive of the Reserve Bank made it quite clear that we can expect more interest rate rises to come – but made little suggestion that real wages will improve any time soon.

The appearance of the RBA before the House economics committee is always a battle between discussing actual economic details and MPs trying to get political sound bites.

In her opening statement to the committee, RBA governor Michele Bullock kept strictly to economics and highlighted the issue of higher international inflation due to the Iran war.

Bullock noted that “there is little sign of resolution of the Middle East conflict. Oil and related prices have increased sharply again and will add directly to inflation”.

She also noted the boom in AI investment around the world that is driving up the costs of IT equipment and also interest rates due to the surge in demand for financing.

Prior to the committee appearance, the market was forecasting an 82 per cent likelihood of a rate rise when the Reserve Bank meets on September 28-29.

By the end of the hearing, this had risen slightly, and the likelihood of at least two rate rises within the next 10 months........

© The New Daily