Good economic news?

Yesterday the reserve bank of Australia left interest rates at 2.5%, a record low for Australia. there was also news that Australia grew by 0.8% last quarter (3 months), faster than was expected.

The RBA feel that export growth will continue, but wish to remain accommodating as the rest of the economy grew only slowly. Interesting despite low interest rates borrowing is not growing strongly and this may indicate weak confidence among firms and consumers.

There is little doubt that unemployment will continue to rise, probably for the rest of the year, but the lower dollar is helping exports (as a lower exchange rate causes export prices to fall). The RBA would, however, still like to see the dollar even weaker (perhaps as low as 80c to the USdollar.

Below are articles on the rate decision and the growth figures.

The Australian reports the interest rate decision here

The ABC reports the growth figures here