RBA minutes: Policy consistent with sustainable growth, inflation target

The minutes of the Dec RBA meeting when interest rates were held unchanged at 1.5% have been released.

As the RBA minutes notes: "taking account of the available information, the Board judged that holding the stance of monetary policy unchanged at this meeting would be consistent with sustainable growth in the economy and achieving the inflation target over time."

On the labour market, the RBA observes: "Growth in employment, particularly full-time employment, had increased and the unemployment rate had fallen to a four-year low. Although wage growth had been a little lower than expected in the September quarter, it appeared to have stabilised at a low rate. Leading indicators of labour demand had been broadly consistent with continuing strength in the labour market. In these circumstances, spare capacity in the labour market was expected to be absorbed gradually and wage growth was expected to pick up over time."

"The Australian dollar had continued to fluctuate within its range of the preceding two and a half years. An appreciating exchange rate would be expected to result in a slower pick-up in domestic economic activity and inflation than currently forecast", the RBA added.

Key headlines - Reuters

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