Australia's central bank maintained its benchmark cash rate at 2.50 percent, as expected, and repeated its guidance that "on present indications, the most prudent course is likely to be a period of stability in interest rates."
The Reserve Bank of Australia (RBA), which has maintained its key rate since August 2013, also said data are consistent with moderate growth in the economy and continued accommodative monetary policy should help strengthen demand and growth while inflation is expected to remain in line with the bank's 2 -3 percent target over the next two years.
As in recent months, the RBA repeated that the Australian dollar remains above most estimates of its fundamental value and is offering less assistance than would normally be expected in achieving balanced growth in the economy.
But the RBA also acknowledged that the exchange rate of the Australian dollar had recently traded at lower levels, mainly due to the stronger U.S. dollar. The Australian dollar was trading at 1.15 to the U.S. dollar today, slightly down from 1.12 at the start of the year but sharply below its level in 2011 through 2013 when it was trading above 1 to the U.S dollar.
The RBA issued the following statement: