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Monetary Policy

RBA Minutes on September Monetary Policy

September 15, 2015

After watching the signs of improvement in Australia’s non-mining industries, RBA decided to keep the interest rates on hold for September month too.

At this monetary policy RBA released its minutes today in which the board states that, “Members observed that recent indicators of consumer sentiment and retail sales had been consistent with some increase in consumption growth. They also noted that conditions in the housing market overall had remained strong and that housing price inflation nationally had risen since the beginning of the year, notwithstanding regional disparities”.

RBA also said that,”GDP growth was expected to remain below average in year-ended terms, but members recognised that a number of indicators of domestic economic activity had shown some improvement over recent months. Non-mining business investment was still expected to pick up over time as a result of the depreciation of the exchange rate over the past year and a further gradual rise in household expenditure“.

In the minutes it was also noted that the Australian dollar was getting to a level where it could give the economy a boost. Members noted that this presented a downside risk to the overall outlook for growth in China over the coming year, although they recognised that it was too early to assess accurately the effect of several recent policy changes designed to support activity.

At this the JP Morgan economist Stephen Walters said that, in his opinion the RBA will think a lot for cash rates to be cut again.

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