RBA governor urges Aussies to carry on saving

Australians need to keep topping up their savings accounts in order to safeguard against any further economic setbacks.

That is according to the governor of the Reserve Bank of Australia (RBA), Glenn Stevens who has warned that, while the income from the mining boom is generating much wealth right across the country, this should be channelled into savings accounts rather than frittered away.

Addressing the Victorian state parliament, he called on local governments, business and individual households to heed the lessons of the past and adopt a cautious approach to money.

"With a large boost to income, we need to think about the balance between saving and spending, because we do not know the permanent level of the terms of trade," he said.

Mr Stevens did add that the evidence suggests that Australians are already stepping up their savings efforts and erring on the side of economic caution, despite the fact the country is steadily emerging out of the recent downturn.

The RBA opted to keep interest rates steady at its February meeting.

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