Article by ForexTime
As widely expected, the Reserve Bank of Australia announced after its policy meeting today that it left its benchmark interest rate unchanged for a 13th-straight month.
The record low rate remained at 2.5%, as the central bank said that it predicted slower-than-average growth ahead as the nation’s mining boom slows. Meanwhile, the strong exchange rate of the aussie was also an issue for the RBA.
In an official statement released after the RBA meeting today, Governor Glenn Stevens said that “Moderate growth in the economy is occurring.”
“Overall the bank still expects growth to be a little below trend over the year ahead, ” he added.
The RBA downgraded its forecasts for growth and inflation last month, and Mr. Stevens urged businesses to embrace “animal spirits” by investing and employing more people.
The Australian economy needs time to transition away from the mining boom. Non-mining sectors of the economy, especially housing construction, are slowly recovering, but unemployment has meanwhile risen to its highest levels in 12 years, stirring caution among policy makers.
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The Australian dollar weakened going into the RBA announcement today, dipping to as low as $0.9284 versus the US dollar.
Article by ForexTime
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