The Reserve Bank of Australia (RBA) on Tuesday left its key cash rate at a record low of 2.5 percent, where it’s been since August of last year. The decision was widely expected.
In a statement, the RBA says recent data suggest moderate growth is occurring. While resource spending is falling significantly, investment outside of mining is improving. Overall the central bank expects economic growth to be below trend in the year ahead. The Australia dollar dipped 0.3 percent against the dollar on the news, while stock markets showed little reaction.
“I agree that [with the RBA’s] view on where the economy is going. The consumer confidence numbers that we are seeing recently is certainly bounced back from concerns, and there is some confidence that service-related investments are coming into play, said Tony Farnham, economist & analyst at Patersons Securities.