In Shadow Of Greek Crisis, Reserve Bank Leaves Cash Rate At 2%

In the shadow of the Greek debt crisis, the Reserve Bank has left interest rates unchanged, following today’s monthly board meeting.

The cash rate will stay at 2%. The rate was last changed in May when it was cut by 25 basis points.

Greece defaulted on a debt repayment last week. A referendum last Sunday voted 60% against further austerity measures imposed on Greece by the European Union.

In its decision, the RBA noted that: “The Australian dollar has declined noticeably against a rising US dollar over the past year, though less so against a basket of currencies. Further depreciation seems both likely and necessary, particularly given the significant declines in key commodity prices.”

Statement from Glenn Stevens, Governor of the Reserve Bank of Australia.

Statement by Glenn Stevens, Governor: Monetary Policy Decision

At its meeting today, the Board decided to leave the cash rate unchanged at 2.0 per cent.

The global economy is expanding at a moderate pace, but some key commodity prices are much lower than a year ago. This trend appears largely to reflect increased supply, including from Australia. Australia’s terms of trade are falling nonetheless. [Read more…]


No Change In Interest Rates; Cash Rate Stays At 2.0%

The Reserve Bank of Australia has left interest rates unchanged at its monthly meeting today.

Last month’s historic low cash rate of 2.0% stays in force for the time being.

Statement by Glenn Stevens, Governor of the Reserve Bank.

At its meeting today, the Board decided to leave the cash rate unchanged at 2.0 per cent. [Read more…]


Reserve Bank Cuts Cash Rate To Historic Low Of 2%

The Reserve Bank has cut interest rates for the second time this year. The cash rate will fall 0.25% to 2.0%.

In its announcement today, the Reserve says: “The Board judged that the inflation outlook provided the opportunity for monetary policy to be eased further, so as to reinforce recent encouraging trends in household demand.”

Statement by Glenn Stevens, Governor of the Reserve Bank of Australia.

At its meeting today, the Board decided to lower the cash rate by 25 basis points to 2.0 per cent, effective 6 May 2015.

The global economy is expanding at a moderate pace, but commodity prices have declined over the past year, in some cases sharply. These trends appear largely to reflect increased supply, including from Australia. Australia’s terms of trade are falling nonetheless. [Read more…]


Reserve Bank Cuts Interest Rates By 0.25%

The Reserve Bank of Australia has cut the cash rate by 0.25% to 2.25%.

It is the first movement in interest rates for eighteen months. The bank cut rates by 0.5% during 2013 but made no changes in 2014.

In a statement, the Governor of the Reserve Bank, Glenn Stevens, said commodity prices have continued to decline and the price of oil has fallen significantly in recent months. Lower energy prices will strengthen global output and lower inflation. However, the bank says growth in Australia “is continuing at a below-trend pace”.

Stevens says the interest rate cut will “is expected to add some further support to demand, so as to foster sustainable growth and inflation outcomes consistent with the target”.

Statement from Glenn Stevens, Governor of the Reserve Bank of Australia.

Statement by Glenn Stevens, Governor: Monetary Policy Decision

At its meeting today, the Board decided to lower the cash rate by 25 basis points to 2.25 per cent, effective 4 February 2015.

Growth in the global economy continued at a moderate pace in 2014. China’s growth was in line with policymakers’ objectives. The US economy continued to strengthen, but the euro area and Japanese economies were both weaker than expected. Forecasts for global growth in 2015 envisage continued moderate growth. [Read more…]


Interest Rates Stay On Hold For 14th Consecutive Month

The Reserve Bank of Australia has left interest rates unchanged for the fourteenth consecutive month.

The cash rate of 2.5% was set in August 2013 and has remained unchanged since then. It is the longest period of interest rate stability since 2005-06.

In a statement, the bank’s Governor, Glenn Stevens, said: “The exchange rate has declined recently, in large part reflecting the strengthening US dollar, but remains high by historical standards, particularly given the further declines in key commodity prices in recent months. It is offering less assistance than would normally be expected in achieving balanced growth in the economy. Looking ahead, continued accommodative monetary policy should provide support to demand and help growth to strengthen over time. Inflation is expected to be consistent with the 2–3 per cent target over the next two years.”

Statement by Glenn Stevens, Governor of the Reserve Bank of Australia.

Statement by Glenn Stevens, Governor: Monetary Policy Decision

At its meeting today, the Board decided to leave the cash rate unchanged at 2.5 per cent. [Read more…]