The Reserve Bank of Australia has kept the official interest rates at the historic low of 0.1 per cent. The RBA Board also indicated it would not increase the cash rate until the actual inflation rate was sustainably within the 2-3 per cent range, which it did not expect to happen until at least 2024.
While the RBA Board commented that the outlook for the global economy had improved over recent months due to the ongoing rollout of vaccines and while the path ahead is likely to remain bumpy and uneven, “there are better prospects for a sustained recovery than there were a few months ago”.
“Global trade has picked up and commodity prices have increased over recent months,” Dr Lowe said.
“Even so, the recovery remains dependent on the health situation and on significant fiscal and monetary support.”
The RBA said lending rates for most borrowers were currently at record lows and housing prices across Australia had increased recently and although housing credit growth to owner-occupiers had picked up, investor and business credit growth remained weak.
“Lending standards remain sound and it is important that they remain so in an environment of rising housing prices and low interest rates,” Reserve Bank Governor Philip Lowe said.
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