RBA keeps cash rate steady
(6 June 2010 – Global) The expectations of the financial markets and analysts were confirmed today when the Reserve Bank of Australia kept rates steady for second straight month.
After six interest rate increases since October last year Australia defined itself as one of the small number of developed countries to tighten monetary policy as the global financial crisis settled.
Glenn Stevens, the governor of the RBA, kept his position the same on the status of monetary policy saying that interest rates to borrowers were at about average for the last decade.
Pending further information about international and local conditions for demand and prices, the board views this setting of monetary policy as appropriate, Mr Stevens said in an accompanying statement.
The governor highlighted that ‘some uncertainty’ still existed around the pace of future global economic growth and the caution being created in financial markets because of the European sovereign debt crisis.
Mr Stevens also noted that ‘growth in China is now starting to moderate to a more sustainable rate’.
Analysts noted that Mr Stevens' latest statement removed the words that monetary policy was right for the 'near term'. This suggested the central bank may keep the rates steady in August even if the June quarter inflation data were strong, analysts told The Australian.
The inflation report is due later this month.
Glenn Stevens, the governor of the RBA, kept his position the same on the status of monetary policy saying that interest rates to borrowers were at about average for the last decade.
Pending further information about international and local conditions for demand and prices, the board views this setting of monetary policy as appropriate, Mr Stevens said in an accompanying statement.
The governor highlighted that ‘some uncertainty’ still existed around the pace of future global economic growth and the caution being created in financial markets because of the European sovereign debt crisis.
Mr Stevens also noted that ‘growth in China is now starting to moderate to a more sustainable rate’.
Analysts noted that Mr Stevens' latest statement removed the words that monetary policy was right for the 'near term'. This suggested the central bank may keep the rates steady in August even if the June quarter inflation data were strong, analysts told The Australian.
The inflation report is due later this month.
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