The Reserve Bank has left the cash rate and other key policy measures unchanged at its monthly board meeting.
The cash rate remains at a record low 0.1 per cent.
"The economic recovery in Australia is stronger than earlier expected and is forecast to continue," Reserve Bank governor Philip Lowe said in a statement.
"An important ongoing source of uncertainty is the possibility of significant outbreaks of the virus, although this should diminish as more of the population is vaccinated."
The governor stuck to the line of previous statements that the board is unlikely to raise the cash rate until 2024 at the earliest.
"It will not increase the cash rate until actual inflation is sustainably within the two to three per cent target range," he said.
"For this to occur, the labour market will need to be tight enough to generate wages growth that is materially higher than it is currently."
