If the Reserve Bank of Australia raises its target for the cash rate, this indicates that it is:

Question

Quizplus · Accepted Answer

When the Reserve Bank of Australia raises its target for the cash rate, it indicates that it is pursuing a contractionary monetary policy. The cash rate affects lending rates across the economy, and a higher cash rate makes borrowing more expensive, reducing spending and leading to lower inflation. This policy is typically used to control inflation by slowing down economic growth.

If the Reserve Bank of Australia Raises Its Target for the Cash