The Reserve Bank of Australia’s June 15–16 meeting minutes underscored persistent concern that inflation remains well above the target of 2 to 3%, with underlying pressures expected to intensify in the June quarter. Policymakers noted widespread labor cost strains and weak sentiment among households and businesses, even as activity data pointed to a cooling economy. The board signaled further tightening remains possible after three rate hikes this year, arguing that restrictive policy and elevated oil prices could temper demand and aid rebalancing. Headline inflation eased to 4.0% in May from 4.2% as fuel costs fell, but core inflation accelerated, with the trimmed mean rising to 3.6% from 3.4% as firms passed on higher costs tied to Middle East tensions. While the board discussed prospects for easing regional strains, it cautioned that “global commodity supply constraints would take some time to resolve,” even if a lasting resolution emerges.

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