RBA Sees Steady Rates as Growth Weighed by Budget Cutbacks

Australia’s central bank signaled it will keep interest rates low for some time as inflation is contained and the economy adjusts to fewer resource projects.

“Overall growth in coming quarters was likely to be below trend given expected slower growth in exports, the decline in mining investment and the planned fiscal consolidation,” the Reserve Bank of Australia said in minutes released today of its May 6 meeting, where it kept the cash rate unchanged at 2.5 percent. “The current accommodative stance of policy was likely to be appropriate for some time yet.”