Building figures suggest RBA rate rise in June 'is unlikely'

The Reserve Bank of Australia (RBA) is unlikely to increase interest rates next month in light of weak construction figures released by the Australian Bureau of Statistics, it has been claimed.

Helen Kevans, economist at JP Morgan, told the Australian Associated Press that the expected contraction in growth in gross domestic product during the March quarter could also contribute to the decision to keep interest rates at 4.75 per cent.

This is the level set by the RBA in November last year, when it was pushed up by 25 basis points.

The RBA board is set to meet again on June 7th to decide whether or not a further interest rate hike is necessary.

"We think the RBA will sit on the sidelines until August, when it will have the second quarter consumer price index data in hand," Ms Kevans said.

Over the last ten years, the highest rate was set in March 2008 when interest rates peaked at 7.25 per cent.

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