The Reserve Bank of Australia (RBA) has announced it will leave the cash rate unchanged at 4.75 percent for the tenth consecutive month.
Governor Glenn Stevens said the outlook for the global economy is less clear than earlier in the year. “Conditions in global financial markets have been very unsettled over recent weeks, as participants have confronted uncertainty about both the resolution of sovereign debt problems and the prospects for economic growth in Europe and the United States.”
Nevertheless, Australia remains sheltered from volatile international markets, Stevens said, pointing to high terms of trade and strong growth in national income. Financial indicators suggested monetary policy has forced a degree of restraint among credit providers, which is evident in softening housing prices.
Stevens said the Board judged it prudent to maintain the current stance of monetary policy in the face of tight financial conditions. “In future meetings, the Board will continue to assess carefully the evolving outlook for growth and inflation,” Stevens added.
The last interest rate rise was in November 2010, when the Reserve Bank listed the interest rate by 25 basis points.