RBA to leave rates on hold until August

The RBA is expected to keep the official cash rate on hold at 4.75 per cent today, because of the recent run of softer consumer data. In a survey of 21 economists by Dow Jones Newswires, all expected no change in the stance of monetary policy, with a strong Australian dollar acting as a headwind for the economy.

"We expect the RBA have no imminent need to increase interest rates given the need to gauge the economic repercussions from Japan, amongst other natural disasters. We also expect the high currency to rate a mention considering its natural hedge against inflationary forces," said Christopher Gore, a currency analyst and trader with Go Markets in Melbourne.

Economists have predicted that the RBA could raise rates in August, especially if inflation begins to increase.

Source: The Australian