The Reserve Bank of Australia (RBA) has kept the official cash rate steady at 2.25 per cent.
The Monetary Policy decision by Glenn Stevens conceded commodity prices have been falling and that growth is below trend-pace but says it is “appropriate to hold interest rates steady for the time being.”
It was suggested that the Australian dollar will continue to fall against the US dollar in light of falling commodity prices.
Possible rate cuts in the near future have not been ruled out.
Many analysts expected a cut in the cash rate this month and the Australian dollar has spiked on the news, up to $US0.7678.
Credit growth to investors was noted as exceeding that to owner-occupiers and the Governor’s statement highlighted that house price rises in Sydney have been strong.
The bank says it’s working with other regulators to assess and contain economic risks that may arise from the housing market.
