Australian central bank upbeat on economy

Sydney, Aug 7 (IANS) The Reserve Bank of Australia (RBA) appears likely to hold off on another interest rate cut, issuing an upbeat assessment of the Australian economy on Friday.

The central bank expects Australia’s economy to grow to between 3.0 and 4.5 percent by December 2017 despite reducing its economic growth forecast for the Australian 2015-16 financial year by half a percentage point, reported Xinhua news agency.

The Australian financial year runs from July to June.

The RBA expects economic growth to be in the range of two to three percent in the year to June 2016.

In its quarterly statement on monetary policy, the central bank said the unemployment rate will peak somewhere below the RBA’s previous forecast peak of 6.5 percent.

Mining investment is expected to fall, but the housing sector is going strong and there will be other parts of the economy that will benefit from a lower Australian dollar, such as tourism, the central bank said.

Local media reported RBA Governor Glenn Stevens seemed particularly pleased with recent jobs growth and refrained from repeating his recent concerns about the Australian dollar being over-valued.

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