- March 6, 2012
- Posted by: admin
- Category: Finance News, Inflation, Interest rate, Wealth
The Reserve Bank of Australia has left the official cash rate on hold for the second consecutive month. In the minutes of the Monetary Board Meeting, the Board said that “the expectation that the world economy will grow at a below-trend pace this year, but does not suggest that a deep downturn is occurring. Most information on the Australian economy continues to suggest growth close to trend overall, with differences between sectors and considerable structural change. Labour market conditions softened during 2011 and the unemployment rate increased slightly in mid year, though it has been steady over recent months. CPI inflation has declined as expected and will fall further over the next quarter or two.”
“Interest rates for borrowers have generally risen slightly since the Board’s previous meeting, but remain close to their medium-term average. Credit growth remains modest. Housing prices have shown some sign of stabilising recently, after having declined for most of 2011, but generally the housing market remains soft.”
The decision was largely expected, with most economists now expecting rates to stay on hold until mid-year.