Colin Brinsden, AAP Economics and Business Correspondent
(Australian Associated Press)
The Reserve Bank has left its key interest rates at a record low at its monthly board meeting, while warning it is monitoring developments in the heated housing market.
The cash rate has stood at 0.1 per cent since November.
So too has the central bank’s three-year bond yield target, aimed at keeping rates low, and its term funding facility rate, which assists banks lend to business.
RBA governor Philip Lowe reiterated the bank would not increase the cash rate until inflation was sustainably within the two to three per cent inflation target, and wages growth was materially higher.
“The board does not expect these conditions to be met until 2024 at the earliest,” Dr Lowe said on Tuesday.
He noted housing markets have strengthened further, with prices rising in most jurisdictions, while housing credit growth to owner-occupiers has picked up, with strong demand from first home buyers.
“Given the environment of rising housing prices and low interest rates, the bank will be monitoring trends in housing borrowing carefully and it is important that lending standards are maintained,” Dr Lowe said.