Monetary Policy

An important role of the Reserve Bank is conducting monetary policy to achieve the objectives of the Reserve Bank Board. Its three objectives are to best contribute to: the stability of the currency (which means price stability), full employment, and the economic prosperity and welfare of the people of Australia.

To achieve price stability, or low and stable inflation, the Reserve Bank uses a flexible medium-term inflation target, with the goal of keeping inflation between 2 and 3 per cent, on average, over time. The Reserve Bank sets the cash rate to influence economic activity and inflation to achieve this goal.


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