The Reserve Bank of Australia this week left the official interest cash rate at 2.5 per cent, after board members noted that inflation remained under control and the Australian dollar’s strength was holding back the transition away from mining sector growth.
The decision was widely expected and it means the rate has been on hold for 12 months, the longest single period since 2006.
Most economists don’t expect the RBA to touch interest rates at least until around the middle of next year. The RBA said: “In the board’s judgement, monetary policy is appropriately configured to foster sustainable growth in demand and inflation outcomes consistent with the target. On present indications, the most prudent course is likely to be a period of stability in interest rates.”
Source: Fairfax Media