Australia's Central Bank Lifts Interest Rates

Australia’s central bank has raised interest rates to a decade high as it seeks to bring down soaring prices.

The Reserve Bank of Australia (RBA) on Tuesday lifted the benchmark rate by a quarter-percentage point to 3.1 per cent.

Along with six previous hikes since May, the jump adds more than 1,000 Australian dollars ($672) to the monthly cost of an average mortgage.

RBA Governor Philip Lowe said inflation remained too high at 6.9 per cent, far above the target of 2-3 per cent.

He said; “Global factors explain much of this high inflation, but strong domestic demand relative to the ability of the economy to meet that demand is also playing a role."

Lowe said he expected inflation to rise to 8 per cent during the final quarter before easing next year.

Australia’s inflation slowed to 6.9 per cent in October, while home prices fell for a seventh straight month in November.