Interest rates are at average levels says RBA

08/09/2010

At its meeting yesterday, the Board of the Reserve Bank of Australia decided to leave the cash rate unchanged at 4.5 per cent. Recent information suggests that the Australian economy has been growing at around trend pace. This has been helped by high levels of public spending over the past year but private demand has also been firming.

Business credit has stabilised and while credit conditions for some sectors remain difficult, evidence is slowly emerging of more willingness to lend. Credit outstanding for housing has slowed a little over recent months, and the upward pressure on dwelling prices appears to have abated. The current setting of monetary policy is resulting in interest rates to borrowers around their average levels of the past decade.

With growth in the near term likely to be close to trend, inflation close to target and with the global outlook remaining somewhat uncertain, the Board judged this setting of monetary policy to be appropriate for the time being.

Source: RBA