Reserve to hold fire on interest rates while the economy ticks over

There's not going to be a near-term cut to interest rates and the chances of a reduction next year are slim as the non-mining parts of the economy are expected to pick up pace, economists say. A survey of 14 economists says the Reserve Bank of Australia will not cut the cash rate at its board meeting on Tuesday. Only eight of those surveyed expect a rate cut next year. The mining and resources investment boom is at, or near, its peak and other parts of the economy are expected to pick up pace and have a more significant role in driving the Australian economy. Citigroup said there was evidence the Australian economy was starting to rebalance, helped by recent rate cuts. Bank HSBC said a lower exchange rate would also help the economy. There was data showing domestic expenditure was slowly improving, it said.

There's not going to be a near-term cut to interest rates and the chances of a reduction next year are slim as the non-mining parts of the economy are expected to pick up pace, economists say. A survey of 14 economists says the Reserve Bank of Australia will not cut the cash rate at its board meeting on Tuesday. Only eight of those surveyed expect a rate cut next year. The mining and resources investment boom is at, or near, its peak and other parts of the economy are expected to pick up pace and have a more significant role in driving the Australian economy. Citigroup said there was evidence the Australian economy was starting to rebalance, helped by recent rate cuts. Bank HSBC said a lower exchange rate would also help the economy. There was data showing domestic expenditure was slowly improving, it said.

Join the Conversation...

There are comments posted so far.

If you'd like to join this conversation, please login or sign up here

Related Articles