Home-loan borrowers have been given the heads-up not to expect any more interest rate cuts after the RBA gave the economy a quietly confident vote of approval.
RBA governor Glenn Stevens indicated in comments last week that the RBA no longer had interest rate cuts at the top of its agenda.
The Australian dollar rose by more than a cent after the comments.
Mr Stevens said there were positive signs for the economy for later in the year despite the sluggish start in 2014.
Since rates have been cut to a record low 2.5 per cent, house prices in most capital cities are up and so is activity in the construction sector.
After the bank’s first meeting of the year Mr Stevens said we’re most likely in for a period of stability in interest rates.
On the positive side, the RBA said business and consumer confidence were rising and the economy was finally benefitting from a lower Aussie dollar.
On the negative side, the RBA said unemployment was expected to continue creeping up with a further slowing of wage growth.
The comments were a turnaround from last year, in effect shutting the door that had been left open by the RBA in regards to further interest rate cuts.
