"Taking account of the available information, and having eased monetary policy at its May meeting, the board judged that holding the stance of policy unchanged at this meeting would be consistent with sustainable growth in the economy and inflation returning to target over time"
-RBA Governor Glenn Stevens
The Reserve Bank of Australia decided not to change interest rates and left at 1.75% level at the conclusion of its June monetary policy meeting. Such outcome was widely expected by financial economists. Meanwhile, recent outstanding economic data including gross domestic product, which expanded 1.1% in the first quarter of this year is suggesting economic growth and but inflation was weak and expected to remain so for some time due to low wages growth and cost pressures. The Australian dollar, in turn, accelerated on Tuesday after the Reserve Bank of Australia kept interest rates on hold.
Concerning the RBA Governor press conference, Mr Stevens was no in mood to talk about interest rates. It was the briefest statement in six months from the governor of the Reserve Bank. It is not an easy thing to read too much into this statement, but it is still clear that the RBA is going to do nothing until it gets a better reading on what it sees as the three main issues of the day. In a statement, Reserve Bank governor Glenn Stevens highlighted while the global economy is continuing to expand, it was doing so at a lower-than-average pace. "In Australia, recent data suggests overall growth is continuing, despite a very large decline in business investment. Other areas of domestic demand, as well as exports, have been expanding at a pace at or above trend," he added.
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