Decision to lift interest rates influenced by higher-than-forecast rent increases, RBA says

Minutes from recent meeting say surprise call was ‘finely balanced’ and aimed at diminishing the risks of high inflation becoming entrenched

• Get our morning and afternoon news emails, free app or daily news podcast

The Reserve Bank’s surprise decision to lift interest rates this month was “finely balanced” and aimed at diminishing the risks of high inflation becoming entrenched in the economy.

Those risks include “strong population and low rental vacancy rates” pushing rental growth “even higher” than the RBA’s main forecast, the bank said in the minutes from its 2 May board meeting that hiked the cash rate another 25 basis points to 3.85%.