committed a "blunder" in their decision to leave rates on hold, according to one industry figure.
largely followed economists' expectations yesterday by choosing to leave the cash rate on hold at 3%. But 1300 Home Loans managing director John Kolenda said the decision shows a "complete lack of common sense".
"The domestic economy is going nowhere at the moment and the RBA
board have failed most consumers and other struggling sectors of the economy by sitting on their hands," he said.
While Kolenda has argued the economy is a "mixed bag" and that the RBA
"haven't got much right" in their handling of the cash rate, RP Data's Tim Lawless
said the decision to hold on rates made sense.
"Consumer confidence has shown some improvement, commodity prices are once again on the rise, and share markets have shown some consistent gains as well," Lawless said.
But Kolenda said the Reserve still had scope to further stimulate the economy with cuts.
“They still have plenty of ammunition as our official interest rate remains well above most of our trading partners – hence the continuing strong Australian dollar which is hurting exporters and the tourist industry.”