The Reserve Bank of Australia (RBA) has, for the second month in a row, kept the official cash on hold at 1.75 per cent.
The RBA said the global economy is continuing to grow, but at a lower than average pace. The central bank noted that financial markets have been volatile since Brexit, but nevertheless continue to function effectively. However, further effects from Brexit remain to be seen and may be hard to discern.
The RBA also noted commodity prices are higher than recent lows, but this follows very substantial declines over recent years.
In regards to inflation, the RBA said it has been quite low. Further, inflation is expected to remain this way for some time because of very subdued growth in labour costs and very low cost pressures elsewhere in the world.
For now, the RBA says the prudent course of action is to maintain the current cash rate.
The Australian dollar has risen marginally to $US0.7515 following this decision.
