Statement on Monetary Policy November 2024
Central bank: rba | Document type: inflation_report | Date: 2024-11-01

Statement on Monetary Policy – November 2024
Headline inflation has fallen, but underlying inflation is still too high. The
cash rate will stay restrictive until the Board is confident that inflation is
moving sustainably to the middle of our 2–3 per cent target range.
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What is going on in the economy?
Underlying inflation remains too high.
Part of the recent decline in headline inflation is expected to be
temporary, and headline inflation is expected to increase again as
cost-of-living relief unwinds. Underlying inflation, which is a better guide
to inflation momentum, is easing more slowly. The labour market remains
tight and total demand for goods and services still exceeds supply. But the
gap between demand and supply is narrowing and inflation is coming down
How do we see the economy developing?
Economic growth is expected to recover.
The recovery in GDP growth is expected to come a little later than forecast
in August, but household spending is still expected to increase as real
incomes rise in response to tax cuts and easing inflation. Growth in
Australia’s major trading partners is expected to be moderate, but we have
revised our 2025 forecasts a little higher after an economic stimulus
package was announced in China.
Labour market conditions are tight and are expected to continue to ease
gradually.
The unemployment rate is expected to rise over the coming year as overall
labour demand and supply comes roughly back into balance. Wages growth is
expected to continue to slow gradually over this time.
Inflation is expected to reach 2.5 per cent by late 2026.
Underlying inflation is expected to ease slowly as demand in the economy
moves back into line with supply. While headline inflation is expected to be
in the target range in the first half of next year, part of this is due to
temporary cost-of-living relief.
The outlook is highly uncertain. On the one hand, if conditions in the
labour market are stronger than expected and productivity growth remains
weak, this could slow progress in bringing inflation to target. On the other
hand, household spending might not increase as quickly as expected, which
could mean that inflation returns to target faster. Heightened geopolitical
risks and potential changes to trade and fiscal policies abroad add to this
uncertainty.
What did the Board decide?
At its November meeting, the Board decided to leave the cash rate unchanged.
Today’s decision will support inflation returning to target and balances the
two objectives of monetary policy – price stability and full
employment.
More on the November 2024 monetary policy decision...
Reserve Bank Board Statement
The Board decided to leave the cash rate target unchanged at 4.35 per cent.
Monetary Policy Board Statement
Media Conference
Governor Michele Bullock addresses the media after the monetary policy decision.
Media Conference
Monetary Policy Minutes
Minutes of the Reserve Bank Board meeting, published two weeks after the decision.
Monetary Policy Minutes