The Reserve Bank of Australia has kept the cash rate on hold at 1.5 per cent at its September meeting today.
In little surprise to the market, outgoing governor Glenn Stevens said a wait and see approach would be necessary after the August cut as household debt grows, despite a volatile Aussie dollar and weak US jobs data.
“Taking account of the available information, and having eased monetary policy at its May and August meetings, the Board judged that holding the stance of policy unchanged at this meeting would be consistent with sustainable growth in the economy and achieving the inflation target over time,” he said.
The RBA has only cut the cash rate twice at its September meeting in the last decade and after a cut last month, few economists expected further intervention today.
The August rate cut saw the Big Four banks withhold an average of about half of the rate cut, much to the chagrin of borrowers.
For someone on a $500,000 loan, a fully passed on rate cut could equal a saving of $70 a month.