RBA Lowe: ''Plausible we could raise rates later this year''

The Reserve Bank of Australia's Philip Lowe has said that it is ''plausible we could raise rates later this year depending on the economy.''

He added that he hasn't said rates won't go up. 

AUD could get a lift on such rhetoric, but there hasn't been any knee-jerk reaction thus far. 

His comments during a testimony at a virtual hearing before the House of Representatives Standing Committee on Economics are being scrutinised for an insight as to when the RBA will start to raise rates. His testimony comes shortly after very hawkish rhetoric from a voting member of the Federal Open Market Committee, James Bullard, who said that the Fed could consider hiking rates at an Inter-meeting. Markets are on inflation alert and expect the RBA to follow suit sooner than previously communicated by the central bank. 

Key comments

Lowe says no evidence economy is overstimulated at moment.

Lowe says going to wait until seeing evidence that inflation has picked up in a sustainable way.

Lowe says hope over time real interest rates return to positive territory.

Lowe says would hope to get real interest rates above zero, and above 2.5% inflation.

Lowe says going to look at the experience with forward guidance in the policy review.

Lowe says broader labour costs rising faster than the wage price index.

Lowe says plausible could raise rates later this year depending on economy.

Lowe says evidence in inflation will only emerge slowly over time.

Lowe says inertia in Australian labour market, businesses reluctant to raise wages.