The Reserve Bank of Australia (RBA) has left the official cash rate at 1.75 per cent at its July board meeting.
The decision was widely predicted with most economists expecting the RBA will hold off on a rate cut until the next set of inflation data is released in late July. The recent financial market volatility from the Brexit and political deadlock did not alter the RBA’s economic outlook.
Recent data suggest overall growth is continuing, despite a very large decline in business investment. The labour market is consistent with a modest pace of expansion in employment in the near term. Domestic demand has been expanding at a pace at or above trend with low interest rates supporting domestic demand.
Credit growth has been moderate and financial institutions are in a position to lend, although some lenders are taking a more cautious approach to lending in certain segments.