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Monetary Policy

An Overview to RBA Minutes on August Monetary Policy

August 18, 2015

RBA has released its minutes today on August monetary policy that focuses mainly on domestic economic conditions, as they are improved more than as per expectations by the experts.

The minutes states that:

  • Labour market conditions had been a little better than expected over the previous few months.
  • Unemployment rate had been consistent over past months.
  • Housing market conditions had remained strong, supported by low interest rates.
  • Housing credit growth had been stable over recent months.
  • Survey measures of business conditions, confidence and capacity utilisation had been more positive.

It was noted that, domestically, economic activity had generally been more positive over recent months. Very low interest rates were continuing to support strong growth in dwelling investment and consumption, and the further depreciation of the Australian dollar was expected to impart stimulus to the economy through stronger net exports. The forecast for the unemployment rate had been revised lower since the previous forecasts had been presented. Credit was growing overall, with growth in lending to the housing market broadly steady over recent months. House prices continued to rise strongly in Sydney and Melbourne, but trends had been more varied in a number of other cities.

Keeping all these considerations in mind, the board decided to leave the cash rate unchanged to this month also. Further information regarding the monetary policies will be updated by the RBA in the upcoming meetings.

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