- Reserve Bank of Australia
Minutes of the Reserve Bank of Australia's meeting showed there is no need to ease monetary policy further, as the weaker Australian Dollar and previous rate cuts continue to support the economy. On September 1, the RBA kept the official cash rate unchanged at a all-time low 2.0% for the fourth straight month and refrained from further easing. Instead, the bank suggested that the Australian economy is already making the necessary adjustments amid the commodity downturn. The central bank believed that the economy has finally reached the turning point, as last quarter Australia's GDP rose a mere 0.2%, or 2.0% on an annual basis, the slowest pace in four years. RBA Governor Glenn Stevens reiterated his view that the lower interest rates fall, the more limited impact the monetary policy has. Yet, the central bank forecast consumer inflation would remain consistent with the 2% to 3% target over the next year or two.
However, the RBA warned China's slowdown and market turbulence increased risks to global growth, underscoring the economic challenges confronting new Prime Minister Malcolm Turnbull. Moreover, the bank also reiterated its concern that any US Fed interest rate hike as soon as this week could spur fresh market upheavals.
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