Australian Official Cash Rate Held at 2.5% Record Low as Expected

July 1, 2014

The statement from Governor Stevens released today asserts that

  • Markets appear to be attaching a very low probability to any rise in global interest rates over the period ahead.
  • Australian growth will be “a little below trend over the year ahead.”
  • Domestic costs remain “contained.”
  • The fundamentally excessive value of the Aussie dollar continues to impede achievement of more balanced economic growth.
  • “Continued accommodative monetary policy should provide support to demand and help growth to strengthen over time. Inflation is expected to be consistent with the 2–3 per cent target over the next two years.”

The statement gives no inkling of a rate change during the second half of 2014.  It’s been 2.5% since August 2013.

Copyright 2014, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.



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