Interest rates remain
(2 June 2010 – Australia) The Reserve Bank of Australia announced it would hold its key interest rate steady this week, a welcomed relief for home and business owners after a series of hikes since October.
The central bank’s decision to leave interest rates at 4.5 percent was anticipated by many economists, after recent debt woes in Europe threatened financial stability world-wide.
In a statement following the decision, the central bank’s governor Glenn Stevens said that bond rates and equity markets were lower as a result of the sovereign debt troubles, adding that investors were displaying more caution.
Mr Stevens highlighted that decisions made by European policy-makers and the responses to the decisions would need to be ‘remain under review’.
At this stage, global growth is still expected to be at about trend pace in 2010, Mr Stevens said.
In Asia, growth has continued to be quite strong and may need to moderate in the year ahead, the RBA’s governor continued.
Mr Stevens said the interest rates to borrowers were around their average levels of the past decade, which is a significant adjustment from the very expansionary settings reached a year ago.
In a statement following the decision, the central bank’s governor Glenn Stevens said that bond rates and equity markets were lower as a result of the sovereign debt troubles, adding that investors were displaying more caution.
Mr Stevens highlighted that decisions made by European policy-makers and the responses to the decisions would need to be ‘remain under review’.
At this stage, global growth is still expected to be at about trend pace in 2010, Mr Stevens said.
In Asia, growth has continued to be quite strong and may need to moderate in the year ahead, the RBA’s governor continued.
Mr Stevens said the interest rates to borrowers were around their average levels of the past decade, which is a significant adjustment from the very expansionary settings reached a year ago.
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