Australia's central bank said the economy looked to be slowing enough
to significantly reduce inflation over time, providing growing scope to
ease interest rates from 12-year highs. The Reserve Bank of Australia
(RBA) gave little guidance on when it might cut rates but did warn that
the deteriorating outlook for the world economy, made worse by the
global credit squeeze, could be a serious risk to the economy at home.
RBA: "While inflation is likely to remain high in the short term, the
Board judged at its August meeting that demand was slowing to an extent
that could be expected to bring about a significant reduction in
inflation over time."