In remarks that sent the Australian dollar soaring, Mr Stevens indicated yesterday that he would be prepared to lift rates even if the unemployment rate was still going up.

‘‘I have never seen written down a rule of thumb that says we wait until unemployment has peaked before we lift the cash rate,’’ he told a business audience in Sydney. ‘‘It depends what else is happening, and also depends how low we went.’’

Financial markets immediately priced in an even-money chance of a rate rise by Christmas, with futures trading suggesting the cash rate will jump 0.15 percentage points by December and 1.5 to 2 points over next year.

A 2-point rise would push standard mortgage rates back up above 7 per cent and add about $300 to the monthly cost of servicing a $300,000 loan.

‘‘Households can afford it,’’ said Macquarie Bank strategist Rory Robertson. ‘‘None of them would have taken out a loan expecting these historically low rates to last.’’

The dollar jumped half a cent to US 83.2 cents on the news, its highest point since the onset of the financial crisis in September. Shares rose for an 11th consecutive day.

But some experts remained sceptical about an early move on rates. ‘‘Any recovery will remain tentative until unemployment stops rising,’’ said ANZ economist Riki Polygenis. ‘‘And inflation is falling, so there’s no inflationary justification for a hike.’’

Mr Stevens said he had sensed a ‘‘tangible improvement’’ in Australia’s outlook and that the downturn might turn out to be ‘‘not one of the deeper ones of the post-war period’’.

Referring to interest rates, Mr Stevens said that in Australia and in other countries it would soon be necessary for authorities to ‘‘remove the exceptional accommodation being supplied at present’’.

‘‘I am not saying when that is, but in due course that will be required,’’ he said. ‘‘Getting the timing right won’t be easy.’’

Mr Stevens said higher interest rates would be needed to rein in inflationary expectations as the economy recovered and also to ensure that strong demand for housing was ‘‘translated into more dwellings, not just higher prices’’.