Policymakers of the Reserve Bank of Australia discussed scenarios in which policy tightening may need to be considered, the minutes of the meeting held on December 8 and 9 showed Tuesday.
Members became less confident that monetary policy remains restrictive, the minutes showed. Policymakers assessed that inflationary pressures could be a little more persistent than had been previously estimated.
Members viewed that there is some upside risk to the outlook for underlying inflation in the near term. Also, they said headline inflation is likely to exceed the November forecasts in the near term.
At the same time, the board observed that the risks to the economic outlook no longer appeared as pronounced as earlier in the year.
Although recent data suggested the risks to inflation had tilted to the upside, members felt it would take a little longer to assess the persistence of inflationary pressures.
At the meeting, the board unanimously agreed that it was appropriate to leave the cash rate target unchanged at 3.60 percent, which is the lowest since March 2023.
Members discussed the circumstances in which an increase in the cash rate might need to be considered at some point in the coming year.
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