The Reserve Bank of Australia has continued its record-breaking streak of keeping the country’s official interest cash rate unchanged for the 31st consecutive month.
The rate will remain at 1.5 per cent, where it has sat ever since it was shifted downward from 1.75 per cent in August 2016.
The decision comes just hours before the Federal Budget is released later today.
RBA governor Philip Lowe said the low interest rate was continuing to support the economy.
“Further progress in reducing unemployment and having inflation return to target is expected, although this progress is likely to be gradual,” he said in a statement.
“Taking account of the available information, the Board judged that it was appropriate to hold the stance of policy unchanged at this meeting.”
The RBA noted that while the labour market was strong, GDP data painted a “softer picture” of the economy, with GDP rising by just 0.2 per cent in the December quarter to be 2.3 per cent higher over 2018.
“The adjustment in established housing markets is continuing, after the earlier large run-up in prices in some cities,” Mr Lowe said.
“Conditions remain soft and rent inflation remains low.”
He said inflation more broadly also remained low and stable, but was expected to increase in the next couple years.
Other factors in the long run of low interest rates include low wage growth and weak household spending.