THE Reserve Bank will keep the official cash rate at 3.50 per cent for the third consecutive month.
In a statement released today, central bank governor Glenn Stevens said the stance was appropriate due to inflation expected to be consistent with the target and growth close to trend.
“In Australia, most indicators available for this meeting suggest growth has been running close to trend, led by very large increases in capital spending in the resources sector,” Mr Stevens says.
“Consumption growth was also quite firm in the first half of the year, though some of that strength was temporary.
“As a result of the sequence of earlier decisions, interest rates for borrowers are a little below their medium-term averages. The impact of those changes is still working its way through the economy, but dwelling prices have firmed a little and business credit has picked up this year.”
The National Secretary of the Construction Forestry Mining and Energy Union Michael O’Connor says he is “disappointed” with today’s decision.
“The RBA decision to sit on its hands again whilst huge swathes of the economy struggle is a missed opportunity the nation may pay dearly for,” he said.
“Combined with poor retail sales figures and an anemic tourism industry, there is a compelling case for a rate cut.”