RBA retains three per cent rate

The Reserve Bank of Australia has opted against a further interest rate cut, by keeping the cash price at three per cent.

It cited stabilising worldwide conditions as a reason for the decision, noting places like China have seen strong growth in their economy of late, while Europe is still weakening.

Despite an improvement in outlook across a number of financial markets, "credit conditions remain difficult", the Bank said.

It added: "For the global economic recovery to be durable, continued progress in restoring balance sheets is essential."

Consumer spending and exports have both given the Australian economy a boost, with confidence beginning to take an upward direction.

However, the Bank believes spending will slow in the consumer segment, while housing activity and investment in the public sector will gain strength into 2010.

It explained it feels the current rate is sufficient and appropriate for the current financial situation.

Meanwhile, Westpac and St George Bank recently revealed they are following the lead of National Australia Bank in discounting overdraft fees.

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