The Reserve Bank of Australia (RBA) has announced it will keep cash interest rates at the historic low of 0.1 percent in the wake of its first board meeting in 2021 on Feb. 2. RBA governor Philip Lowe said that while the economy is bouncing back more strongly than anticipated, with GDP predicted to return to its pre-pandemic level 6 to 12 months earlier than previously expected and the unemployment rate looking at dropping further, the outlook for wage and inflation growth remains weak. “The CPI increased by just 0.9 percent over the year to the December quarter and wages (as measured by the Wage Price Index) are increasing at the slowest rate on record,” Lowe said. He also said that the RBA expects both to remain below 2 percent over the next couple of years. “The board will not increase the cash rate until actual inflation is sustainably within the 2 to 3 percent …
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