Business

RBA opens door to rates cut

The RBA came under fierce criticism for its decision not to cut the cash rate in April, particularly from the struggling housing and construction sectors.
The RBA came under fierce criticism for its decision not to cut the cash rate in April, particularly from the struggling housing and construction sectors.
  • Board is waiting for demand to slow before easing the cash rate
  • Economy performed worse than expected in the second half of last year
  • Outlook for dwelling prices hit developer confidence hard

THE Reserve Bank board has left the door open for cutting the cash rate when it next meets in May, a week before Treasurer Wayne Swan hands down his fifth Federal Budget.

Board members had lowered their assessment of the pace of growth since cutting 25 basis points from the cash rate in December, minutes from their April 3 meeting reveal.

The Reserve board opted to leave the cash rate on hold at 4.25%.

"If slower growth in demand could be expected to result in a more moderate inflation outcome, then a case could be made for a further easing of monetary policy," the minutes read.

Minutes from the meeting indicate the board thought it "prudent" to assess an array of new data before considering an adjustment to monetary policy.

"The board would have the opportunity at its next meeting to review the inflation outlook based on comprehensive new data on prices, as well as information on demand and output," the minutes read.

The board indicated the Australian economy had performed below expectation in the latter part of last year.

"The national accounts for the December quarter had shown an increase in real GDP of 0.4% in the quarter and 2.3% over the year, which were both lower than expected," the minutes read.

"Private domestic demand had grown strongly over the year, led by growth in mining investment.

"However growth in exports over 2011 had been weaker than expected, mainly because of lower coal exports, which, in turn, reflected a slower recovery from the floods in Queensland in early 2011, together with a slower take-up of new rail and port facilities in NSW and Queensland."

The RBA came under fierce criticism for its decision not to cut the cash rate in April, particularly from the struggling housing and construction sectors.

Board members considered the challenges facing these industries in arriving at their April decision.

"Members spent some time exploring reasons for the weakness in many of the indicators for housing turnover and building activity across Australia," the minutes read.

"They noted the apparent sensitivity of developers to the outlook for dwelling prices. New dwelling construction had fallen in the December quarter and there was little sign of a pick-up in building or loan approvals, though house prices had shown some signs of stabilising recently."

Topics:  cash rate developers dwelling approvals rba wayne swan



Foodies' scavenger hunt: are you up for it?

IF YOU want to give your tastebuds the flavour sensations of a lifetime, here is the ultimate foodie’s scavenger hunt through Brisbane.

5 minutes with Israel Folau on footy, life and love

Israel Folau and Silver Fern netballer Maria Tutaia announced their engagement last last year.

WE CAUGHT up with football star and Brisbane ex-pat Israel Folau.

10 reasons to head to South Bank this summer

Head to the only inner-city beach in Australia!

South Bank has a ridiculous amount of fun things to do.

Five mammoth events you need in your life

No Caption

BRISBANE isn’t known for doing things by halves…

How to make your child's every dream come true...

Take a dip at South Bank in the inner-city beach.

‘I DON’T want to do fun things, Mum and Dad’… said no child ever!

How to do Eat Street the right way

Know where to start and where to end to avoid a huge food coma before you get to experience all the goodies!

EVERY Friday and Saturday night, Hamilton comes alive.

You can do WHAT in Brisbane?!

Talk about arriving in style! Take your pub crawl to the next level with a helicopter!

BET you didn't know you could do these things in Brisbane...

Show your Aussie pride at Glengallan on Australia Day

Australian flag
Photo Trevor Veale / The Coffs Coast Advocate

THIS Australia Day head out to the historic Glengallan Homestead

Granite Belt vineyards thrive through summer

IN THE RED: Mike Hayes with some of Symphony Hill's Pinot Noir.

Summer no stop to Stanthorpe district grapes

Southern Downs sunflower season coming to an end

OVER FOR ANOTHER YEAR: Sunflower season is wrapping up for many growers on the Southern Downs.

Sunflowers dip their heads as another season comes to end

Local Partners

What's on this Australia Day

PACK up the family, gather your friends and don't forget some sunscreen and hats for the plethora of Australia Day celebrations on the Southern Downs.


Reigning Miss Rodeo Australia will be in town for awards

Miss Warwick Rodeo 2016 Ashleigh Grant, Miss Australia Rodeo Katy Scott, Miss Canada Rodeo Samantha Stokes and Miss America Rodeo Katherine Merck in Warwick during the 2016 rodeo.

Reigning Miss Rodeo Australia flying in to be part of 2017 awards

T20 might be batters game but no one told bowlers

Steven Lyons bats at Slade Park as WBAS chase the 166 scored by Summers.

Bowlers go well as tight battle on for final spots

Action hots up with semis this morning in carnival cricket

Dale's XI will play Dutch's Rudders at noon on Queens Pary Synthetic today.

The draw for final day of Warwick cricket carnival

Lion roars to straight to No 1 at Aussie box office

Nicole Kidman, David Wenham and Sunny Pawar in a scene from the movie Lion.

THE Australian-made movie a hit, while Rogue One nears record mark.

Ozzy Osbourne fell asleep during his driving test

Not a good idea to give Ozzy a Ferrari

Kristen Stewart to host SNL

Kristen Stewart will host a pre-Super Bowl episode of SNL next month

Louis Tomlinson celebrated his son's first birthday

Louis Tomlinson and Briana Jungwirth celebrate son's first birthday

Kylie Minogue will take husband's name

Kylie Minogue will take her fiancé Joshua Sasse's surname

Nicole reveals her biggest parenting challenges

Actress Nicole Kidman.

Nicole Kidman says her kids are ‘deeply attuned' to her moods.

Why investors are flocking to Moranbah

Moranbah homes are selling like hotcakes, creating a supply problem

Investors are scrambling to get into the market

Stockland's $150m pitch: Build it and they will come

Gladstone Marina. The Gladstone Regional Council offers a range of exciting job opportunities. Photo Contributed: Murray Ware.

Here's why we need to see Stockland upgrade start soon.

By the water's edge

Secure your seachange

HOT PROPERTY: Money to spend on land, buildings

File picture.

Sale, leasing of industrial real estate picks up in Mackay

Why tree-changers want to buy in the Southern Downs

Core Logic property statistics reveal the region's median house price for the Downs dropped 1.5% to $241,250 the September quarter.

Region's median house price drops 1.5% to $241,250

Ready to SELL your property?

Post Your Ad Here!