The Reserve Bank of Australia has kept the official cash rate 'on hold' at 2 per cent at its first meeting of 2016.
The RBA's decision to keep the cash rate on hold was correctly predicted by 100 per cent of the economists polled by finder.com.
BT chief economist Chris Caton described the RBA as a "reluctant cutter" – but that could change it financial market volatility continues, he said.
Economist Saul Eslake said that nothing has happened since the last meeting to warrant a change in monetary policy settings.
"The fall in the exchange rate since early December is a sufficient response to the deterioration in global financial market sentiment," Mr Eslake said.
The Australian National University Centre for Applied Macroeconomic Analysis (CAMA) Shadow Board ascribed a 69 per cent probability to 2 per cent being the correct monetary setting.
"The confidence that a rate cut is appropriate has dropped for the second time in a row and now equals 17 per cent (22 per cent in December); the confidence that a rate increase, to 2.25 per cent or higher, is necessary has risen to 14 per cent (11 per cent in December)," said the Shadow Board.
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