(4 April 2012 – Australia) The Reserve Bank of Australia (RBA) left rates on hold again this month at 4.25 percent.The central bank acknowledged recent economic growth was weak, and if inflation remains subdued it is likely to cut rates at its next meeting in May.
In his statement accompanying the rates decision, RBA governor Glenn Stevens made it clear the central bank is ready to cut interest rates again depending on the strength of March quarter inflation figures, scheduled for release on April 24, a week ahead of the next rates meeting.
‘At today’s meeting, the Board judged the pace of output growth to be somewhat lower than earlier estimated, but also thought it prudent to see forthcoming key data on prices to reassess its outlook for inflation, before considering a further step to ease monetary policy,’ Mr Stevens said.
‘The Board’s view was also that were demand conditions to weaken materially, the inflation outlook would provide scope for easier monetary policy.’
The ANZ Bank, meanwhile, will also hold its regular monthly meeting to set its interest rates on Friday next week, with borrowers waiting to see if the bank again breaks ranks with the RBA to raise rates on its own.