Interest rates are likely to stay on hold when the Reserve Bank of Australia meets in May, economists say.
Today’s The Australian has reported a surprise increase in core inflation in the first quarter that has made a May rate cut, more unlikely.
Core inflation rose by a stronger than expected 1.1 per cent from the December quarter for an annual increase of 4.15 per cent while the Reserve Bank’s weighted median CPI rose 1.2 per cent for an annual increase of 4.4 per cent.
Before the release of the inflation figures, economists had expected the RBA to cut interest rates by 25 basis points.
Some economists have now changed their forecasts and now believe that the RBA will hold off on a May rate cut.
Source: The Australian
