RBA hints interest rate hike 'still likely'

Minutes from the May 3rd meeting of the Reserve Bank of Australia's (RBA's) board indicate that an increase in interest rates in the near future is still likely.

At the gathering, the RBA decided to keep the cash rate at the 4.75 per cent level set in November 2010, which was when the financial institution opted to raise it by 25 basis points.

However, experts have suggested that this is likely to be increased next month, with economists from Westpac, ANZ and the National Bank of Australia all forecasting a rise.

The latest minutes cited by the Australian Associated Press support this view, stating: "Members judged that if economic conditions continued to evolve as expected, higher interest rates were likely to be required at some point."

According to the RBA, the gross domestic product figures for the first quarter of the year are expected to decline due to the natural disasters that hit the east coast of the country in the summer of 2010.

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