Economy will grow over the next year, says RBA

The economy is likely to grow over the next year, the Reserve Bank of Australia (RBA) has stated.

It made this comment in light of news that it will increase the cash rate by 25 basis points to 3.5 per cent from today (November 4th).

The organisation noted that economic conditions in the country had been stronger than expected and that various policy initiatives were probably to thank for bringing spending forward.

Investment opportunities, public infrastructure spending and labour market conditions are all improving, which the RBA added would help the financial situation.

The decision to raise the cash rate came as a result of there being less risk of serious economic contraction, stated the group.

It said: "The adjustments at the October and November meetings will work to increase the sustainability of growth in economic activity and keep inflation consistent with the target over the years ahead."

Responsible for monetary policy, the RBA aims to achieve low and stable inflation over the medium term.

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