SYDNEY—The Reserve Bank of Australia raised its benchmark interest rate for the first time in more than a decade, acting to tame elevated inflation that is threatening the country’s economic recovery from the Covid-19 pandemic.
The RBA lifted the cash rate to 0.35%, from 0.10%, and signaled further increases are likely as it seeks to bring long-term inflation back toward its 2%-3% target. It represents a significant gear shift by the RBA, which as recently as March had been signaling patience even as other global central banks laid the groundwork for aggressive moves to tighten monetary policy.
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