Australia’s Central Bank Maintains Interest Rates

2025-09-30 05:08:02

(MENAFN) Australia’s central bank opted to leave interest rates unchanged on Tuesday, a decision widely expected by economists.

The Reserve Bank of Australia (RBA) confirmed that its Monetary Policy Board voted unanimously to maintain the cash rate at 3.6 percent during its meeting on Tuesday.

Since the start of 2025, the board has implemented three cuts, lowering the rate by a total of 0.75 percentage points from 4.35 percent. However, the board noted that ongoing uncertainties surrounding both domestic economic conditions and inflation—driven by both local and international factors—warranted a cautious approach.

Although Australia's headline and underlying inflation rates were within the RBA's 2-3 percent target range for the second quarter of 2025, the board warned that inflation in the third quarter might exceed previous expectations, according to its official policy statement.

"Uncertainty in the global economy remains elevated. There is a little more clarity on the scope and scale of U.S. tariffs and policy responses in other countries, suggesting that more extreme outcomes are likely to be avoided," the board remarked in the statement.

The central bank also reiterated concerns about the negative impact of trade policies on global growth, as well as the ongoing geopolitical risks that continue to pose a threat to the broader global economy.

The Monetary Policy Board is scheduled to reconvene in early November to reassess the cash rate.

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