The benchmark interest rate of the Reserve Bank of Australia is left unchanged for its sixth straight meeting. Experts are forecasting that the official interest rate will rise one percentage point to 5.75 per cent in the next 12 months – equivalent to an extra $200 in monthly repayments on the average $300,000 home loan – as the RBA tries to manage Australia’s patchwork economy.
Central bank Governor Glenn Stevens stated that the decision reflects ?softened? prices for raw materials and the unemployment rate that?s been little changed near five percent. The consumer prices are not expected to accelerate much above the target range of two to three percent.
?The weather-affected prices should fall back later in the year, though substantial rises in utilities prices are still occurring,? Stevens said in a statement. ?The bank expects that, as the temporary price shocks dissipate over the coming quarters, CPI inflation will be close to target over the next 12 months.?
The Australian dollar has lost more than half a US cent since the central bank made their decision.