Australia’s central bank has reiterated its plans to keep interest rates at record lows and appears unlikely to change its stance unless the jobs market improves.
In the minutes of its April 1 board meeting, released on Tuesday, the Reserve Bank of Australia repeated its well worn mantra that “the most prudent course was likely to be a period of stability in interest rates”.
At the meeting the central bank left the cash rate at a record-low 2.5 per cent.
The RBA said that at recent meetings its board members had “noted that the cash rate could remain at its current level for some time if the economy was to evolve broadly as expected”.
While it is unclear how long the “period of stability” would last, a stronger jobs market would likely see an increase in rates.
“While there had been some tentative evidence of a slight improvement in a number of labour market indicators, conditions would need to improve further before the unemployment rate could be expected to decline,” the RBA said in the minutes.
The bank said it had seen moderate growth in wages, a slight improvement in the jobs market and a stronger housing and retail market, noting that the lower interest rate appeared to be supporting the local economy.
Since the April 1 meeting, the official unemployment rate has fallen to 5.8 per cent in March, from 6.1 per cent in February.
However the RBA had noted variability in the figures, given recent volatility in the jobs data related to survey sampling.
– with AAP