Biggest OCR rise ever: Here's what the governor said

Higher interest rates necessary

The Monetary Policy Committee today increased the Official Cash Rate (OCR) from 3.5% to 4.25%.The Committee agreed that the OCR needs to reach a higher level, and sooner than previously indicated, to ensure inflation returns to within its target range over the medium term.

Core consumer price inflation is too high, employment is beyond its maximum sustainable level, and near-term inflation expectations have risen.

Global consumer price inflation is broad based and remains heightened. Food and energy prices, and persistent core inflation, have combined to create very high headline inflation in many countries.