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ISCOVER
By: Belinda Luc
The Reserve Bank lifted the official cash rate in March in a bid to move “gradually toward normal levels”, minutes of the meeting released yesterday revealed.
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In October 2009, the RBA board members had decided to implement a process of moving the level of interest rates “closer to normal” in response to the strengthening economy.
Yesterday’s minutes stated that given the strengthening performance of the domestic economy, it was appropriate for the RBA to push the official cash rate slightly higher.
“Evidence that had become available recently had confirmed that it remained appropriate for interest rates to move gradually towards normal levels, and that it was timely to take another step in that direction,” the minutes read.
RBA members had also noted that interest rates on loans in Australia had been little changed over the past month, also prompting the cash rate hike.
“Market expectations were that an increase in the cash rate at this meeting was more likely than not.”
