Australian Interest Rates unchanged

The Reserve Bank of Australia as expected left Interest Rates unchanged at 7.25 percent last night breathing a sigh of relief from those with an Australian Mortgages. Australian Housing prices have taken a tumble over the last few months and with the commodity boom seaming to be coming to an end many hoped the RBA would actually cut interest rates and provide a soft landing and slow the economy rather than let it head to a recession.

A summary of the main points are as follows from its policy statement;

There has been substantial tightening in financial conditions.

Scope to move towards less restrictive policy.

Considerable uncertainty surrounds outlook.

Looking more likely that demand will remain subdued.

Inflation likely to decline over time.

Tightening in conditions, rising fuel costs, lower asset value restrain demand.

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