Rates unchanged on low inflation, floods

Reported by AAP
Tuesday, February 1, 2011
The Reserve Bank Of Australia in Martin Place, Sydney.
The central bank spared borrowers an interest rate rise on Tuesday, leaving the cash rate at 4.75.

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The central bank spared borrowers an interest rate rise, leaving the cash rate at 4.75 per cent in a widely expected move.

The Reserve Bank of Australia's (RBA) board on Tuesday cited low inflation and the "temporary adverse effect" of the Queensland floods on the nation's economy as reasons for keeping the cash rate steady.

"Over the next year or two, the efforts to repair or replace infrastructure and housing will add modestly to aggregate demand, compared with what would otherwise likely have occurred," RBA governor Glenn Stevens said in a statement.

"The bank's preliminary assessment is that the net additional demand from rebuilding is unlikely to have a major impact on the medium-term outlook for inflation."

The central bank last raised the cash rate in early November, from 4.5 per cent to its current 4.75 per cent.

21/05/2012 21:46Sydney, Australia. 21 May,2012
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