The bank has decided to leave the official cash rate on hold at 4.35 per cent, as predicted by many economists, as inflation remains above the desired rate.
The Reserve Bank of Australia has opted to leave the official cash rate on hold at 4.35 per cent for the sixth consecutive meeting, as it argues inflation is still too high and there is too much heat in the economy. RBA governor Michele Bullock said the bank's board was "steering a narrow path" of trying to lower inflation without spiking unemployment and would not cut rates in the "near term".
The release last month of the jobs data for June led to speculation the bank could raise interest rates because unemployment went up while more jobs were created than expected and inflation remained sticky. However last week's reveal of June's inflation data was soft enough to allay fears the bank would choose to raise rates again to force people to stop spending.
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