Australia leaves rates on hold

CANBERRA - The Reserve Bank of Australia (RBA) has left interest rates on hold again, with growing speculation it will now leave rates unchanged for the rest of the year.

At 11.30am NZT, the bank issued a short statement saying: "At its meeting on 7 June, the Reserve Bank board decided to leave the cash rate target unchanged at 5.50 per cent."

The bank's board met yesterday to consider any movement in the official cash rate.

But with the economy slowing, several forward indicators suggesting the economy is going to slow even further, and unemployment tipped to increase, there was no cause for the second rate rise of the year.

Economists were unanimous in expecting the RBA to stay its hand today.

But there is now a chance the central bank may cut rates by the end of the year.

NAB chief economist Alan Oster said if anything, the Reserve Bank's next interest rate move would be down.

"I actually expect we might get a rate cut," he said.

Lending finance figures out later today should give a clearer indication of the strength of the property market, while employment figures tomorrow are tipped to show the first signs of an increase in the jobless rate.

- AAP