The official cash rate has not been increased for
June.
The Reserve Bank of Australia (RBA) has
announced it is leaving the interest rate
unchanged at 4.5 per cent for June.
Glenn Stevens,
governor of the organisation, made the declaration as the RBA met to
decide whether or not to increase the official cash
rate.
He noted that investors had displayed a
"good deal more caution" since they met the last time
at the beginning of May - when the group increased the rate from 4.25
per cent to 4.5 per cent.
But this was because of
the worries over sovereign creditworthiness in several European
countries, he continued.
However, due to the
caution the long-term government bond rates declined and equity prices
were reduced and the Australian dollar also went down as part of the
changes.
The RBA noted it would be monitoring the
world economy, predicting that global growth will be "about
trend pace in 2010".
Mr Stevens added:
"Conditions in Europe overall have been relatively weak and the
foreshadowed budgetary tightening will probably mean that this will
continue, but growth is becoming more established in North
America."
He concluded that the interest
rates for borrowers were now consistent with around the past decade - a
"significant adjustment" from the levels met a year
ago.
"Taking all the available information
into account, the Board views this setting of monetary policy as
appropriate for the near term," Mr Stevens
remarked.
These comments come after a survey by the
Australian Associated Press stated that 17 economists predicted the RBA
would maintain its current cash rate.
But they all
believe the rate will hit the 5.25 per cent mark by the end of the
year.
After the May increase, ANZ – which
offers a range of credit cards - upped
the interest rate on a selection of its term
deposits and lending products by 0.25 per cent, the same
increase as the RBA.
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