RBA keeps rate at 4.5% for fourth consecutive month

The Reserve Bank of Australia (RBA) has kept the official cash rate on hold at 4.5 per cent for the fourth consecutive month.

Announcing the decision, RBA governor Glenn Stevens said that recent data had suggested the Australian economy is growing at the expected level.

"Business credit has stabilised and while credit conditions for some sectors remain difficult, evidence is slowly emerging of more willingness to lend," he said.

"The demand for labour has firmed over the past year in line with improving growth. After the significant decline last year, growth in wages has picked up somewhat, as had been expected."

Commenting on the statement, ICAP economist Adam Carr told news.com.au that it appeared the RBA was watching and waiting to see what will happen with the long-term economy before making interest rate changes.

"Their statement, there was nothing in it. They haven't mentioned the consumer, which is odd,'' he said.

Mr Carr predicted the cash rate to rise to 4.75 per cent by the end of the year.

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