The Reserve Bank has left the cash rate at a record low of 2% for the 10th straight month
The cash rate has been on hold since May, when the RBA cut the interest rate by 25 basis points.
In the RBA’s monthly statement on monetary policy, the bank’s governor, Glenn Stevens, said the decline in Australia’s terms of trade had continued amid the global slump in commodities prices, but that overall there were reasonable prospects for continued growth in the economy.
Stevens said that given current conditions, including low inflation and market volatility, “it is appropriate for monetary policy to be accommodative.”
However, he said the RBA would be keeping an eye on the low inflation rate.
“Continued low inflation would provide scope for easier policy, should that be appropriate to lend support to demand,” Stevens added.
