The RBA has left Australia’s target cash rate on hold at 2.5% as expected.
There’s no change in the key paragraph in the statement, which says that “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.”
There’s no concern about inflation, and the RBA also appears relatively unconcerned about housing price increases in the major cities. The board notes that while “some forward indicators of employment have been firming this year, the labour market has a degree of spare capacity and it will probably be some time yet before unemployment declines consistently.”
Credit growth is moderate overall, but with a further pick-up in recent months in lending to investors in housing assets. Dwelling prices have continued to rise.
The Australian dollar has risen slightly on the news.
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