RTTNews - Tuesday, the Reserve Bank of Australia left its key interest rate unchanged at 3% as expected. The official cash rate now stands at its lowest level in 49 years.
The Board's judgment is that the present accommodative setting of monetary policy is appropriate given the economy's circumstances, RBA Governor, Glenn Stevens said. He added that the Board will continue to monitor how economic and financial conditions unfold and how they impinge on prospects for sustainable growth in economic activity and achieving the inflation target.
Economic conditions in Australia was stronger than expected a few months ago, with notable resilience in consumer spending and exports. Confidence also recovered in Australia. This indicates that the risk of a severe contraction in the Australian economy has abated.
Stevens stated, The most likely outcome in the near term is a period of sluggish output, with consumer spending likely to slow somewhat and investment remaining weak.
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