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Reserve Bank of Australia's Deputy Governor Guy Debelle said most of the forces that have contributed to the recent low inflation are set to abate but there is uncertainty about how much longer they will persist.
"We would like to be more confident that inflation will be sustained at a rate consistent with the target," he said in Brisbane, on Wednesday.
Although inflation is likely to be a bit lower in the near term, this is expected to be temporary, Debelle added.
The banker said that further gradual progress on both lowering unemployment and bringing inflation closer to the midpoint of the target is expected over coming years. The current accommodative stance of monetary policy will assist this outcome.
