Lowe left rates unchanged, as expected, as downward pressure on the economy intensified
The Reserve Bank of Australia (RBA) has left its key interest rate unchanged as inflation in Australia (AUS) has slowed and downward pressure on the economy has increased.
The Reserve Bank of Australia left the cash rate (OCR) at 4.1 per cent for the third consecutive policy meeting on Tuesday, a decision that was in line with the expectations of economists' market participants. Successive interest-rate stabilisation means that any further rate rises will face a higher bar.
"Further monetary policy tightening may be needed to ensure inflation returns to target within a reasonable time, but this will continue to depend on data and evolving risk assessments," Governor Lowe said.
After the decision, the yield on the three-year bond erased earlier gains and fell to 3.8 per cent.
Tony Sikamo, market analyst at IG Markets, said: "While Lowe was slow to start the cycle, much of what needed to be done to control inflation was done before he left and Mikhil Brock took over." Lowe's term ends Sept. 17.
Karam Pickering, an economist at Indeed Hiring Lab, said: "We expect the economy to continue to cool in the second half of the year and the unemployment rate to rise to 4%. If this also dampens some domestic inflation, then the RBA tightening cycle may be over."
CM Trade Mobile Application