RBA's Governor Bullock says various indicators continue to suggest labour market conditions remain close to, but a little tighter than full employment, adds monetary policy is well placed to respond to developments

Says: We assessed at the time of the August board meeting that the risk to the outlook was skewed to the upside, while developments since then suggest that although growth in the Australian economy is slowing, some of these upside risks to inflation appear to be materialising. Hearing that many firms are passing on higher input costs. Recent data has been broadly consistent with our expectation that demand growth would ease in the first half of 2016. Conditions in the housing market have softened and a larger-than-expected easing could be a downside risk to economic activity. Key question is whether the tightening in monetary policy to date will be sufficient to bring inflation back to the target in a reasonable time. Lowering inflation is essential. Focused on our mandates to deliver price stability and full employment. In a world of higher-for-longer oil prices, and businesses are now more inclined to pass on cost increases.