RBA

The Australian dollar has suddenly fallen to a seven-month low – and the RBA is no doubt cautiously happy about it.

The Reserve Bank has as expected left interest rates on hold for October at 2.5 per cent, but certainly changed its stance a little on house price inflation and the Australian dollar.

According to the Reserve Bank the best way to arrest the rapid house price rises is to attack the supply side and increase home building activity.

The RBA says the Australian dollar is still overvalued in the current economic climate, after it was buying US87.16c yesterday.

Interest rates have remained unchanged for the 15th policy meeting in a row.

Comments made by the RBA during this month’s meeting again emphasised that the current rate levels were right for fostering sustainable growth.

The Reserve Bank has maintained its line of stability in its final meeting minutes for the year.

The Australian dollar has fallen to a five-year low of 80.71 US cents and it’s fast approaching the level the RBA has spent most of 2014 saying is desirable.

The housing market needs careful monitoring according to an overwhelming number of members of the Reserve Bank Board.

The RBA surprised a few pundits yesterday when they left interest rates unchanged at 2.5 per cent.

Pressure on the RBA to again cut interest rates has eased slightly after unemployment figures released from the Australian Bureau of Statistics for February show a small drop.