Australia: RBA leaves cash rate unchanged
March 1, 2011
The Reserve Bank of Australia (RBA) left the cash rate unchanged at 4.75% at its meeting of 1 March in a decision that was widely expected by market analysts. In the accompanying statement, monetary authorities expressed broadly positive sentiments regarding most factors affecting the Australian economy, both at a global and at a domestic level. The RBA expects that inflation will remain consistent with its 2.0% ? 3.0% target over 2011. Monetary authorities believe that weather-driven production losses in the wake of the Yasi cyclone are putting pressure on prices of agricultural products, but these increases are deemed to be temporary. Taking into account all these developments, the RBA stated that the current monetary policy stance remained appropriate in view of the general macroeconomic outlook. Monetary authorities currently expect inflation to end the year at 3.0% and maintain a medium-term annual average inflation target of 2.0% - 3.0%.
Author: Armando Ciccarelli, Head of Data Solutions