Australia bank leaves rates on hold at 3.25%

Australia's central bank on Tuesday held its official interest rate steady at 3.25 percent, saying that recent indications on the world economy were more positive.

The Reserve Bank of Australia last month slashed 25 basis points off the cash rate, taking it to lows not seen since October 2009 when it first resumed hiking rates following the global downturn.

Economists had been expecting a further 25 basis point cut, but central bank governor Glenn Stevens said the RBA "judged that the stance of monetary policy was appropriate for the time being".

Stevens said while commodity prices were lower and employment was softening, growth has been running close to trend over the past year in mining-powered Australia and inflation was in the RBA's preferred 2-3 percent zone.

"Looking ahead, the peak in resource investment is likely to occur next year, at a lower level than expected six months ago," he said.

"As this peak approaches, the Board will be monitoring the strength of other components of demand."

Stevens said global growth was forecast to be a little below average for a time, and risks to the outlook were on the downside, largely as a result of eurozone woes. But he said risks elsewhere "seem more balanced".

"The United States is recording moderate growth, while recent data from China suggest growth there has stabilised," he said.

Australia was one of the first developed economies to begin raising rates after the global financial crisis rattled markets worldwide, first lifting them in October 2009.

It began pulling back again in November 2011 when the central bank slashed the cash rate for the first time in more than two years to bring it down to 4.50 percent. The rate has been declining ever since.

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