RBA kept the benchmark interest rate at 4.75
07 June 2011
The Reserve Bank of Australia held the overnight cash rate target at 4.75 percent as expected and acknowledged the subdued outlook for industries other than mining and energy. Governor Glenn Stevens said “Outside the resources sector, investment intentions have been revised lower recently.” The Australian dollar reversed gains and investors cut bets the RBA will raise rates in the third quarter after the decision. The interest rate market now sees a 12 percent chance Stevens will increase borrowing costs in July, down from 38 percent before the announcement, and a 30 percent chance in August, a decline from 60 percent.