Economy

Australia's central bank holds rates at record lows, signals patience on policy

Australia's central bank holds rates at record lows, signals patience on policy”

The Reserve Bank has left official interest rates on hold for a 14th consecutive month with no signs it is in a hurry to increase then any time soon.

For more than a year, the cash rate has held at its record-low rate of 1.50 per cent, with many expecting the rate to remain at this level for another month.

Yet policymakers are not in favour of further stimulus with household debt at an all-time peak of 190 per cent of disposable income, and rising at a faster pace than wages growth.

The Australian dollar, which dipped earlier in the day following the release of building approvals data, fell another fifth of a United States cent following the announcement to just above US78¢.

The Reserve Bank of Australia (RBA) expressed concerns over snail-paced wages growth and the lofty Australian dollar, which is adding to subdued price pressures in the economy.

RBA governor Philip Lowe last month said an expected lift in interest rates globally did not have automatic implications for Australia but would flow through to the local market over time.

The decision was widely expected, with the market pricing in no chance of a move ahead of the meeting, and none of the leading market economists forecasting a change. Non-mining investment has also picked up with the RBA happy that firms are rediscovering their "animal spirits".

"That said, the Reserve Bank now has far more reasons to do nothing that act, so it is highly likely the cash rate will stay at 1.50 per cent for yet another month".

Mr. Lowe continues to talk down suggestion that the RBA will join the hawkish chorus of its global counterparts, but economists expect that any upturn in wages growth could prompt the RBA to shift its policy stance if it looks sustainable. The global economy offers little assurance either, with low inflation a sticky issue just about everywhere.



Like this

Latest


03 October 2017
Controversial BHU vice chancellor goes on 'indefinite leave'
The Banaras Hindu University (BHU ) reopened on Tuesday, nine days after students' protest that turned violent. The Registrar will oversee the functioning of the university in the absence of the V-C.

03 October 2017
Rock Legend Tom Petty Reportedly Taken Off Life Support After Cardiac Arrest
Though Petty and his band debuted their first self-titled record in 1976, they continued to perform over the past four decades. Born in Gainesville, Fla., Petty found his musical chops (and many of his future bandmates) in the college town.

03 October 2017
Additional contact revealed between Russia, Trump business
This is the second possible Moscow business deal revealed to have been pitched to the Trump Organization during the campaign. Cohen told the Post Monday that he did not attend the economic conference in St.

03 October 2017
Primo Water Corporation (PRMW) Under Analyst Spotlight
Another way to determine the effectiveness of a company's distributions is by looking at the Shareholder yield (Mebane Faber). This cash is what a company uses to meet its financial obligations, such as making payments on debt or to pay out dividends.

03 October 2017
North Korea opens up a second internet connection enabled by Russian Federation
As the US cracks down on North Korea, Russia is giving the rogue state a cyber lifeline. North Korea is suspected to have thousands of cyberwarriors.

03 October 2017
Raiders 'Shocked and Saddened' by Deadly Shooting in Las Vegas
The Raiders donated $50,000 to a GoFundMe campaign which, by Monday afternoon, had raised more than $1.8 million. Las Vegas police stormed the hotel, but Paddock shot himself to death before they entered his room.

03 October 2017
Taj Mahal missing from UP tourism booklet
The state tourism department has said that the Taj Mahal is not being neglected or marginalised. The booklet also includes Fatehpur Sikri.

03 October 2017
ESPN Airs the Anthem on Monday Night Football, Only Two Players Protest
It wasn't until the halftime show that Fox showed a clip of Saints coach Sean Payton taking a knee with his players. The networks did not show instances of National Football League fans booing or screaming at protesting players.

03 October 2017
At 39, Jonathan Byrd earns spot back on PGA Tour
Peter Uihlein finished first on the playoff money list, and he'll play the PGA Tour for the first time in 2017-18. Seamus Power earned the 25 and final card by $2,688 over Adam Svensson, who missed the cut this week.

03 October 2017
Fortress Investment Group LLC (FIG) Receives Average Recommendation of "Hold" from Analysts
Analysts await Wayfair Inc (NYSE:W) to report earnings on November, 14. ( NYSE:MRK ), 15 have Buy rating , 1 Sell and 4 Hold. Jefferies maintained Fortress Investment Group LLC (NYSE: FIG ) on Monday, September 25 with "Hold" rating .