CANBERRA, AAP – Philip Lowe will get the opportunity to explain his thinking on the outlook for interest rates when he delivers a speech on Wednesday.

The Reserve Bank of Australia governor stuck to the line of being “patient”, rather than lifting the cash rate from a record low 0.1 per cent, in a statement following Tuesday’s first board meeting of the year.

Financial markets had been expecting something more definite in its guidance following the recent drop in the unemployment rate and a surge in inflation pressures.

“While inflation has picked up, it is too early to conclude that it is sustainably within the (two to three per cent) target band,” Dr Lowe said in the statement.

“The board is prepared to be patient as it monitors how the various factors affecting inflation in Australia evolve.”

Dr Lowe will address the National Press Club in Sydney on Wednesday.

The RBA after its monthly board meeting did announce the end of its multi-billion dollar bond buying program as economists had expected, which had aimed to keep market interest rates and borrowing costs low.

“Ceasing purchases under the bond purchase program does not imply a near-term increase in interest rates,” Dr Lowe said.

Westpac chief economist Bill Evans said while the central bank has significantly lifted its inflation forecasts, the governor maintains the line that the sustainability of its inflation forecasts can only be achieved with much clearer evidence around wages growth.

“This is likely to preclude an early rate hike but does not dissuade us from our August call,” Mr Evans said.

The RBA upgraded its annual underlying inflation forecasts after the unexpected jump to 2.6 per cent as of the December quarter.

It now predicts a rate of 3.25 per cent in coming months before declining to around 2.75 per cent over 2023.

The central bank had previously not expected underlying inflation to hit 2.5 per cent until the end of 2023.