SYDNEY: To maintain monetary policy with economic growth, the Australian central bank has kept the interest rates unchanged at 2.0 per cent
The Reserve Bank of Australia has slashed rates by 250 basis points since November 2011 to support the resources-dependent economy as it experiences a sharp fall in mining investment, after an unprecedented boom helped avoid a recession for more than two decades.
In a statement mostly identical to the previous month, Reserve Bank governor Glenn Stevens said it was appropriate to leave interest rates unchanged.
“Information on economic and financial conditions to be received over the period ahead will inform the board’s assessment of the outlook and hence whether the current stance of policy will most effectively foster sustainable growth and inflation consistent with the target,” he said in the statement.
The RBA last cut the cash rate by 25 basis points each in February and May.
Stevens continued his call for a weaker exchange rate despite the Australian dollar’s recent falls against its US counterpart, as investors pile into safe-haven currencies such as the greenback owing to market ructions in Greece.
“The Australian dollar has declined noticeably against a rising US dollar over the past year, though less so against a basket of currencies,” he said.
“Further depreciation seems both likely and necessary, particularly given the significant declines in key commodity prices.”
