Rates on hold despite pickup in economic growth - ANU SHADOW RBA

Australia's official interest rates should remain on hold in October despite encouraging economic growth figures for the second quarter and a rise in full-time employment, The Australian National University (ANU) RBA Shadow Board has found. The board of the Reserve Bank of Australia (RBA) will meet on Tuesday to review official interest rates, which have been at a record low of 1.5 per cent since August 2016. Chair of the RBA Shadow Board Dr Timo Henckel said Australia's economic outlook was more positive, but inflation and wages growth both remained subdued. "Combined with favourable employment figures and an improved outlook for the global economy, the case for increasing the cash rate in the future is building. However, for this month the RBA Shadow Board continues to advocate a hold-and-wait policy," Dr Henckel said. Figures released in September found Australia's unemployment rate held steady at 5.6 per cent but with more than 54,000 new jobs created in August. However, the labour force participation rate rose for the sixth consecutive month, from 65.1 per cent to 65.3 per cent, preventing the increase in jobs from lowering the official unemployment rate.