Australia’s central bank holds rates, warns further hike might be needed

Australia’s central bank held interest rates steady on Tuesday as expected, but cautioned that a further increase could not be ruled out given inflation was still too high and it needed to see more evidence that price pressures were cooling.
Wrapping up its February policy meeting, the Reserve Bank of Australia (RBA) kept rates at a 12-year high of 4.35%, having last lifted them by a quarter point in November.
Markets had wagered heavily on a steady outcome given inflation had eased by more than expected in the fourth quarter and suspected rates have peaked.
The slight chance of another rate hike, however, sent the Australian dollar 0.3% higher to $0.6504, while three-year bond futures were down 5 ticks to 96.3.