At it's meeting on August 6th, the board of the Reserve Bank of Australia have announced the cash rate will remain unchanged at 1.00%.
- The outlook for the global economy remains reasonable, although the risks are tilted to the downside.
- Borrowing rates for both businesses and households are also at historically low levels. The Australian dollar is at its lowest level of recent times.
- The central scenario is for the Australian economy to grow by around 2½ per cent over 2019 and 2¾ per cent over 2020. The outlook is being supported by the low level of interest rates, recent tax cuts, ongoing spending on infrastructure, signs of stabilisation in some housing markets and a brighter outlook for the resources sector.
- Employment has grown strongly over recent years and labour force participation is at a record high. There has, however, been little inroad into the spare capacity in the labour market recently, with the unemployment rate having risen slightly to 5.2 per cent.
- Conditions in most housing markets remain soft, although there are some signs of a turnaround, especially in Sydney and Melbourne. Growth in housing credit remains low. Demand for credit by investors continues to be subdued and credit conditions, especially for small and medium-sized businesses, remain tight. Mortgage rates are at record lows and there is strong competition for borrowers of high credit quality.
The Board will continue to monitor developments in the labour market closely and ease monetary policy further if needed to support sustainable growth in the economy and the achievement of the inflation target over time.
To view the full statement of Philip Lowe, Governor of the Reserve Bank, please click here.
Published : 05 Aug 2019