RBA to maintain interest rate, economists say

A host of economists believe the RBA will not up the official cash rate next month.

The Reserve Bank of Australia (RBA) may maintain the interest rate at the beginning of next month, according to a recent study.

An Australian Associated Press survey has found that 17 economists do not foresee the organisation increasing the official cash level next month from its current 4.5 per cent stage.

The RBA is set to meet on Tuesday (June 1st) to decide what action to take.

But all 17 of those who think the rates will maintain at their current level next month predicted they will rise to 5.25 per cent by the end of the year.

ANZ head of economics Warren Hogan said the RBA has done a lot recently so it can afford to sit back at the moment.

He added: "We don't think Europe is going to dislodge the China story, so we might have a bit of a soft patch where they can sit on hold."

After the latest rate rise the National Australia Bank – which offers a range of credit cards – upped the levels on a range of its savings accounts by 0.25 per cent.

By Mark Hornby