The Reserve Bank has kept rates on hold at 2% for yet another month, with record rates staying in place since May.
Economist had widely predicted the RBA would not make a move on rates with Christmas looming, but suggested a cut could be on the cards for the New Year given global economic conditions.
In his statement on the decision RBS Governor Gleen Stevens says moderate expansion of the economy continues despite a decline in the mining sector.
He pointed to a slowing of the housing market in Melbourne and Sydney where housing prices have moderated.
“In other asset markets, priced for commercial property have been supported by lower long-term interest rates, whole equity prices have moved in parallel with developments in global markets. The Australian dollar is adjusting to the significant declines in key commodity prices”.
“At today’s meeting the Board again judged that the prospects for an improvement in economic conditions had firmed a little over recent months and that leaving the cash rate unchanged was appropriate. Members also observed that the outlook for inflation may afford scope for further easing of policy, should that be appropriate to lend support to demand.”