But in his statement explaining the decision,bank governor Philip Lowe dropped the term “prepared to be patient” in a clear sign the RBA is getting ready for its first rate increase since late 2010.
He said the bank would now focus on new data on inflation,due later this month,and labour costs,which will be released in mid-May,that would provide “important additional evidence” to the board over the coming months.
“Higher prices for petrol and other commodities will result in a further lift in inflation over coming quarters,with an updated set of forecasts to be published in May,” he said.
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“The main sources of uncertainty relate to the speed of resolution of the various supply-side issues,developments in global energy markets and the evolution of overall labour costs.”
Markets reacted immediately to the decision. The Australian dollar added more than half a US cent within minutes of Dr Lowe’s statement while the benchmark S&P/ASX 200 dropped 0.6 per cent within half an hour.
AMP chief economist Shane Oliver said the wait for data meant it was unlikely the RBA would touch interest rates during the election campaign in May.