RBA Minutes from February meeting stated that members agreed that prevailing uncertainties meant it was not possible to have a high degree of confidence in any particular path for the cash rate

• Board concluded inflation would stay stubbornly high if it had not hiked interest rates as it did this month.


• Members agreed that the data received since the previous meeting had strengthened their concern that without a policy response, inflation would remain persistently above target for too long.


• Longer term bond yields in Australia had moved higher, reflecting changed expectations for the cash rate.


• Strategy remains to return inflation to target over time while preserving employment gains.


• Incoming data will be critical in assessing how risks evolve.


• Members noted that measures of longer-term inflation expectations appeared well-anchored and consistent with central banks’ inflation targets. However, measures of inflation expectations at the two-year horizon had increased, most noticeably in Australia.

Analysis details (00:39)

• As a reminder, the RBA hiked rates for the first time in more than two years at the February 2nd-3rd meeting to lift the Cash Rate by 25bps to 3.85%, which was as expected, with the rate decision unanimous, while it stated that inflation is likely to remain above target for some time and that broad measures of wage growth continue to be strong. RBA also stated that job market conditions are a little tight and that capacity pressures are greater than previously assessed, as well as noted that there are uncertainties about the outlook for domestic economic activity and inflation, and the extent to which monetary policy is restrictive. The RBA also released its latest Quarterly Statement on Monetary Policy, which stated that underlying inflation is higher than expected and that GDP growth has continued to pick up, with private demand growth surprisingly strong. Furthermore, it raised its trimmed mean and CPI inflation forecasts, as well as raised its December 2025 GDP forecast, but lowered its projections for year-end GDP for December 2026 and December 2027, while forecasts assumed the Cash Rate at 4.2% in December 2026 and 4.3% in December 2027. RBA Governor Bullock said during the press conference that the pulse of inflation is too strong and that high inflation hurts all Australians, while she stated that the Board thinks inflation will take longer to return to the target and cannot allow inflation to get away from them.

17 Feb 2026 - 00:30- Fixed IncomeData- Source: Newswires