Cash rate unchanged at 3.5%

by Caroline Dann04 Sep 2012

The RBA has left the cash rate unchanged at 3.5% for a third consecutive month.

It confirms industry-wide speculation that cuts wouldn't appear until at least October.
RBA said today's decision was based on continuing stability in the market, which warranted an extension of its wait-and-see approach first adopted in July.
"With inflation expected to be consistent with the target and growth close to trend, but with a more subdued international outlook than was the case a few months ago, the stance of monetary policy remained appropriate," said governor Glenn Stevens.
He added previous cuts were only just starting to take effect in the housing sector. 
"The impact of those changes is still working its way through the economy, but dwelling prices have firmed a little and business credit has picked up this year," he said.
Industry commentators commended the decision, although many hoped for further cuts before year's end.
"While a further rate cut would be a welcome development from the industry, the RBA would be conscious of not overstimulating the housing market.
"In fact, stable home values are probably exactly what they are hoping for with the current interest rate setting," said RP Data's national research director Tim Lawless.