The Reserve Bank of Australia held interest rates steady at a 12-year high of 4.35% at its December policy meeting on Tuesday, as expected, saying it needs to be convinced inflation remains sustainable below the target range.
The decision comes despite the Australian economy recording weak annual growth in the September quarter.
The Reserve Bank of Australia stated that its top priority is to return inflation to its target range of 2% to 3% per annum and also expressed increasing confidence that inflation is gradually moving towards this target.
Australia’s S&P/ASX 200 index was largely unchanged after the decision, and was down 0.2%, as sharp gains in mining companies were offset by a fall in technology stocks.
Mining stocks rose after China’s announcement, with mining giants such as Rio Tinto Ltd (ASX: RIO), BHP Group Ltd (ASX: BHP) and Fortescue (ASX: FMG) rising between 4% and 7%, while technology stocks fell Tracking overnight losses on the technology-driven NASDAQ Composite Index.
