Image courtesy woodleywonderworks on flickr
The Reserve Bank of Australia should leave interest rates unchanged in June despite uncertainty over the economic outlook, the Australian National University's RBA Shadow Board has found. "The Australian economy remains in limbo," said shadow board chair Dr Timo Henckel, from the ANU Centre for Applied Macroeconomic Analysis (CAMA). "While non-mining businesses appear to have strengthened and the labour market is holding up, consumer confidence has taken a hit after the Coalition government's first budget a fortnight ago. Furthermore, revisions to US and Chinese GDP growth are giving cause for concern." The RBA Shadow Board is a project based at CAMA at the ANU Crawford School of Public Policy. It brings together nine of the country's leading experts to look at the economy and make a probabilistic call on interest rates ahead of monthly RBA Board meetings. The RBA Board will hold its June policy meeting on Tuesday. Dr Henckel said the RBA Shadow Board was 76 per cent confident that interest rates should remain steady at 2.5 per cent, up slightly from 74 per cent in May.
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