RBA leaves rates on hold

As had been universally expected, the RBA have left the Cash Rate on hold at 2.5% at today’s meeting.

The full statement (see here) is little changed from last month. There is still reference to a “strong expansion in housing construction”, the fact that “the Bank still expects growth to be a little below trend over the year ahead” and subdued wages growth keeping inflation “consistent with the target even with lower levels of the exchange rate.” The final paragraph is exactly the same as previously; “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.” No sign of any shift from the Bank any time soon.

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