Tuesday, October 4, 2011

Rates held steady at 4.75 percent. RBA says it will take more time to gauge effects of European/US turbulence.

The Reserve Bank today left interest rates on hold at 4.75 percent, saying it needs more time to gauge the impact of turbulence in Europe and the US on the Australian economy.

"It will take more time for evidence of any effects of the recent European and US financial turbulence on economic activity in other regions to emerge."

The decision marks the eleveth meeting that the cash rate has been kept steady.

Here's the RBA's statement released this afternoon.

Some other key quotes:

* The Board noted that financial conditions have been easing somewhat, with interest rates for some housing and business loans declining slightly due to increased competition and the fall in some funding costs in financial markets.

* The exchange rate has also declined from the very high levels of a few months ago. Credit growth remains low, however, and asset prices have declined.

* At today's meeting the Board judged the current cash rate remained appropriate. As always, the Board will continue to assess carefully the evolving outlook for growth and inflation.

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