RBA keeps interest rates on hold at 4.35%
Despite economists' calls for a hike, the Reserve Bank of Australia (RBA) has decided to keep interest rates on hold at 4.35%.
The decision was widely expected, with only one of the 30 economists surveyed by Bloomberg predicting a rate hike.
The RBA's decision comes as inflation in Australia remains stubbornly high. The consumer price index (CPI) rose by 7.8% in the year to December 2023, well above the RBA's target of 2-3%.
Some economists had argued that a rate hike was needed to bring inflation under control. However, the RBA has said that it is willing to tolerate higher inflation in the short term in order to support economic growth.
The RBA's decision to keep rates on hold is likely to disappoint some homeowners who are struggling with rising mortgage repayments. However, it is good news for borrowers who are looking to take out a new loan.
The RBA has raised interest rates 13 times since May 2022. The cash rate is now at its highest level since September 2012.
It is unclear when the RBA will next raise interest rates. The central bank has said that it will continue to monitor inflation and economic growth closely before making any further decisions.
Communications Department
Reserve Bank of Australia
SYDNEY
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