RBA to hold in December

Staff Reporter

The RBA is widely expected to keep the official cash rate on hold when it meets next month.

According to NAB’s monthly business survey, the RBA will resume raising rates in early 2011 until the official cash rate peaks at 5.25 per cent mid-year.

NAB chief economist Alan Oster said the bank had revised its cash rate forecast down from last month.

According to Mr Oster, the bank had expected rates to peak at 5.5 per cent by mid-2011.

“The revised outlook reflects continuing weakness in interest sensitive sectors and the banks doing some of the RBA’s work,” Mr Oster said.