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RBA leaves rates on hold
Released 5 April 2011



The Reserve Bank of Australia (RBA) has left interest rates unchanged at 4.75% for the fifth month in a row as expected by economists.   

REINSW CEO Tim McKibbin said the decision to keep interest rates on hold showed that the RBA was recognising the economy has been affected by floods and cyclones and is trying to recover.

“Australians are not in a position to have the additional burden of cost of servicing more debt.

“We are digging ourselves out of the mud and the RBA aren’t in a position to say the economy is strengthening by increasing interest rates.

McKibbin said the prediction from economists is an increase in rates of between 0.25% and 1.00% in the year ahead.

“It is a remarkable range that I don’t subscribe to because the economy is reasonably fragile and it should be viewed on a month by month assessment.”

McKibbin said some of the factors the RBA would normally be mindful of are the price of consumables including fruit and vegetables which have been driven skyward by floods and cyclones.

“The RBA has been mindful of what has been sitting behind those indicators and has wisely made the decision not to act.

“The strength of the Australian dollar is also more of a sign of a global view of the economy.”

The official cash rate rose 1% in 2010 with rates rising 0.25% in March, April, May and November.