Sydney---Australia's central bank Tuesday left interest rates on hold at 2.25 percent for the second month straight, but kept the door open for cuts amid ongoing weakness in the economy.
The Reserve Bank of Australia said after its monthly board meeting that it was "appropriate to hold interest rates steady for the time being".
In February the RBA slashed its official cash rate by 25 basis points to a record-low of 2.25 percent -- its first easing in 18 months.
"Further easing of policy may be appropriate over the period ahead, in order to foster sustainable growth in demand and inflation consistent with the target," the RBA said in a statement.
The Australian dollar strengthened slightly to trade just below 77 US cents, following financial market expectations of a rate cut. The currency has weakened over the past few months as commodity prices plunged and the US dollar strengthened.
The Australian economy has struggled as it exits an unprecedented mining investment boom that helped it avoid recession for more than two decades.
With inflation low, the economy expanding at a below-trend pace and the unemployment rate at multi-year highs, the Reserve Bank cut the cash rate in February to spur growth.
Analysts said while another rate cut was possible in the next one or two months, the central bank was still waiting to see whether the last easing was a sufficient boost to the economy.
"They've still maintained their easing bias," said JP Morgan senior economist Ben Jarman told AFP.
"For a board that took a long time to get over the line to cut again in February, they obviously want to give the last rate cut some time to breathe life into the economy.
"They are sitting back and looking for signs of that occurring."
AFP
