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RBA Minutes Show Easing Inflation Concerns, Caution On Europe

(RTTNews) - The Reserve Bank of Australia adopted a "wait-and-see" approach in keeping rates unchanged at its July Monetary Policy meeting.

Minutes of the July 6 meeting were made public Tuesday in Sydney. At that meeting, the Official Cash Rate was left unchanged at 4.50 percent.

They showed RBA members were briefed on "ongoing tensions" in the European financial markets, noting that Moody's had downgraded Greece's debt in mid-June.

"Members noted that the coming month would see important announcements about the health of the European banking sector, which had the potential to have a significant impact on financial markets and global confidence," the minutes said.

Domestically, the minutes said RBA staff expected consumer price inflation for Q2 to continue to moderate, and "to be below 3 percent for the first time in 3 year." CPI was expected to rise to just over 3 percent, however, "partly due to the effects of h igher taxes on tobacco."

The RBA also noted that "there were some signs that conditions in the established housing market had eased," and that in the labour market, "hiring had remained strong, with employment having risen again in May, to be 2.5 percent higher over the year."