RBA continues wait-and-see approach
(21 September 2011 – Australia) The minutes of the September 6 Reserve Bank of Australia (RBA) board meeting showed the bank is taking a wait-and-see approach as it monitors inflationary pressures and the flagging global economy.
‘‘A key question for members was the extent to which recent global and domestic developments would reduce capacity pressures in the economy and, in due course help to contain inflation,’’ the RBA said. ‘‘Very little hard data were available, as yet, on which to base such judgements.
‘‘As further information became available on the domestic and international economies, members would continue to assess the medium-term outlook for inflation and growth.’’
The RBA is torn between the need to keep inflation, which is being pushed up by rising commodity prices, under control and the threat of global economic worries on the Australian economy.
Slowing global and domestic economic growth is helping keep a lid on inflation and interest rates.
Consequently, the RBA left the official cash rate on hold at 4.75 percent, where it has been since November 2010.
‘‘As further information became available on the domestic and international economies, members would continue to assess the medium-term outlook for inflation and growth.’’
The RBA is torn between the need to keep inflation, which is being pushed up by rising commodity prices, under control and the threat of global economic worries on the Australian economy.
Slowing global and domestic economic growth is helping keep a lid on inflation and interest rates.
Consequently, the RBA left the official cash rate on hold at 4.75 percent, where it has been since November 2010.
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