RBA KEEPS CASH RATE ON HOLD

Written on the 13 February 2013

RBA KEEPS CASH RATE ON HOLD

THE cash rate will remain at its historic low of 3 per cent, the Reserve Bank of Australia (RBA) announced this afternoon.

The widely expected decision gives the RBA room to move in case of any deterioration in demand, with the soft labour market constraining inflation to 2.25 per cent, consistent with the medium term target.

“Looking ahead, with the labour market softening somewhat and unemployment edging higher, conditions are working to contain pressure on labour costs,” says RBA Governor Glenn Stevens in a statement today.

“Moreover, businesses are likely to be focusing on lifting efficiency under conditions of moderate demand growth.

“These trends should help to keep inflation low, even as the effects on prices of the earlier exchange rate appreciation wane.”

The Housing Industry Association says the RBA should be prepared to lower the cash rate further and called for banks to make their own rate cuts.

“Domestic economic signals are mixed and evidence of a sizeable and sustainable new home building recovery remains far from compelling,” says HIA Chief Economist, Harley Dale.

“Under these circumstances the RBA needs to be willing to act quickly to take interest rates lower.”

“Financial institutions could themselves assist domestic economic prospects by providing interest rate relief they held back from businesses and households last year.”

The RBA believes an accommodative stance in monetary policy is appropriate.

“The inflation outlook, as assessed at present, would afford scope to ease policy further, should that be necessary to support demand,” says Stevens


Latest News

PROPERTY STARTUP PAYS HOME BUYERS

FIRST home buyers could crack into the market years earlier thanks to this Gold Coast startup.

Property platform R...

HOW STAN GORDON WOULD SAVE EAGLE BOYS

STAN Gordon has stepped forward as a suitor for embattled pizza chain Eagle Boys. "Are we the right guys? I ...

EXPRESSO CHARGED OVER WAGES PAY-BACK SCAM

THE owner of two Expresso Carwash Cafés on the Gold Coast is alleged to have skimmed almost $30,000 from the w...

MGI GOLD COAST EXPANDS

LEADING Australasian acounting network, MGI, has bolstered its team by appointing Helen Whelan as director at its Gol...

Related News

AUSSIES AND KIWIS STREAMLINE TRADE

TRANS-Tasman trade will become faster following the signing Mutual Recognition Arrangement (MRA) by Australia and New...

WINGS CLIPPED AS EAGLE BOYS ENTERS ADMINISTRATION

THE Eagle Boys Australian Head Franchisor has entered into voluntary administration, with SV Partners called in to ru...

PRINCE MIXES PHILANTHROPY WITH BUSINESS AT ZAMBRERO

SOMETIMES, after building a successful business and making millions, entrepreneurs will turn their thoughts to philan...

7 POINTS FROM JULY'S DELOITTE BUSINESS OUTLOOK

DELOITTE Access Economics released its monthly Business Outlook today. It puts Brexit in perspective for Australia...

Contact us

Email News Update Sign Up Contact Details

Subscribe to our mailing list

* indicates required
Email Format

PO Box 2087
Brisbane QLD 4001

LoginTell a FriendSign Up to Newsletter