RBA Keeps Rates on Hold For Christmas

Posted on December 5th, 2013 · Posted in News

The Reserve Bank has kept the official cash rate on hold at its last board meeting of the year.

RBA governor Glenn Stevens said in a statement that current monetary policy settings were appropriate. But he continued to stress that the Australian dollar was “still uncomfortably high”.  “The board will continue to assess the outlook and adjust policy as needed to foster sustainable growth in demand and inflation outcomes consistent with the target,” he said.

The move, which was tipped by economists and financial markets, came as better-than-expected retail sales figures for October boosted expectations that previous rate cuts were supporting growth in non-mining industries.

Retail sales rose a seasonally adjusted 0.5% in October on the back of increased spending on food, clothing and at restaurants, Bureau of Statistics data has shown.  New building approvals data for October remained resilient, slipping slightly but not as much as analysts had expected.

The RBA has also continued to flag below-trend growth for the current financial year. Bureau of Statistics data to be released this week is expected show that third-quarter GDP rose by 0.7%, with year-on-year growth reaching 2.5%.

Despite the cash rate being left at 2.5%, interest rates are still at their lowest in recent history.  Let Infinity Partners Finance help you Strengthen Your Financial Future.  Contact us today for a FREE finance review and take advantage of the current rates being offered by a variety of lenders.