Central bank holds rates at 1.5pc for 8th straight month
Australia’s central bank held rates steady yesterday, a widely expected decision given policymakers recently signalled a steady outlook for much of the year ahead.
The central bank kept rates at a record low of 1.5 per cent for an eighth straight month, following easings in August and May last year.
The Australian dollar inched higher after the rate decision, supported by the outlook for steady policy. It was last up 0.5 per cent at A$0.7619 (RM2.58) after dropping to a more than onemonth low of A$0.7598 this week.
Governor Philip Lowe has repeatedly emphasised limits to monetary policy and last month said further cuts in interest rates would not be in the national interest as the danger of a debt-fuelled boom and bust was too severe.
With the governor signalling a high bar for a move lower, interbank futures imply a mere six per cent chance of another cut by August.
Yesterday, Lowe maintained his upbeat tone as Australia’s A$1.7 trillion economy expanded 2.4 per cent last year, helped by a jump in commodity prices and strong consumer spending.
In Manila, the Philippine central bank governor yesterday said it saw no reason to change monetary policy even after inflation picked up to its fastest pace in 27 months last month due to higher food costs.
“As the uptick is in line with forecasts, there appears to be no immediate impetus to adjust the stance of monetary policy, but we will remain data dependent in our assessment and forthcoming decisions,” said Bangko Sentral ng Pilipinas governor Amando Tetangco.
Consumer prices in the Philippines last month rose 3.3 per cent from a year earlier, but was within the range the central bank had expected.