Members of the Reserve Bank of Australia's monetary policy board would not call it imminent, but they would not rule out the possibility of further easing, minutes from the bank's September meeting revealed on Tuesday.
The board members felt that it was important to be able to take further steps, should they become necessary, the minutes showed - particularly since the Australian economy has continued to grow slightly below trend.
"Members agreed that the bank should again neither close off the possibility of reducing rates further nor signal an imminent intention to reduce them. The board would continue to examine the data over the months ahead to assess whether monetary policy was appropriately configured," the minutes said.
At the meeting, the board decided to keep the benchmark cash rate unchanged at a record-low of 2.5 percent on Tuesday, with a possible depreciation of the currency expected to facilitate rebalancing of the economy.
The RBA has reduced the cash rate by a cumulative 225 basis points since November 2011 on the premise that accommodative policy is needed to support demand in areas outside the resources sector, as the peak in mining investment approaches.
The easing in monetary policy since late 2011 has supported interest-sensitive spending and asset values, and further effects can be expected over time, the bank said.
"The decision to reduce the cash rate at the August meeting, where the board had judged that the outlook for inflation provided the scope to ease monetary policy further, brought the total reduction in the cash rate since late 2011 to 225 basis points. Lending rates had declined to historically low levels as a result, which, together with the lower - though still high - exchange rate, were continuing to provide a substantial degree of policy stimulus to the economy," the minutes said.
The policymaker also noted that the pace of borrowing has remained relatively subdued, though recently there are signs of increased demand for finance by households.
The unemployment rate has edged higher and inflation has been consistent with the medium-term target, the bank noted. However, the growth in labor costs is expected to remain moderate over the next one to two years despite the recent slide in the currency.
"GDP looked to have grown at a pace that was a little below trend in the June quarter and more timely data suggested a similar pace of growth over recent months. Household spending looked to have been growing at somewhat below average, although measures of consumer confidence had picked up and were a little above average. Conditions in the housing market had continued to improve in response to the current low level of lending rates," the minutes said.
The board also noted that global financial conditions remain very accommodative, though the recent reassessment by markets of the outlook for US monetary policy has seen a noticeable rise in sovereign bond yields, from exceptionally low levels.
Global growth is now running a bit below average this year with reasonable prospects of a pick-up next year.
"There had been a modest rise in global commodity prices since the previous board meeting. Spot prices for iron ore had increased, consistent with further growth in Chinese steel production. Crude oil and base metals prices had also risen over the past month," the minutes said.
Also on Tuesday, the Australian Bureau of Statistics said that the total number of new motor vehicle sales in Australia was up a seasonally adjusted 0.8 percent in August compared to the previous month, standing at 94,396. That follows the 3.5 percent contraction in July.
By category, sales of passenger and sports utility vehicles gained 2.1 percent and 2.9 percent, respectively while other vehicles shed 5.3 percent.
By region, New South Wales and the Australian Capital Territory each saw a 2.7 percent increase, followed by South Australia (1.5 percent) and Queensland (1.3 percent).
Over the same period, sales in Tasmania plummeted 14.1 percent.
On a yearly basis, new motor vehicle sales added 0.2 percent after rising 3.0 percent in the previous month.
Upon the release of the data, the Australian dollar bounced back from early lows against other major currencies, trading near 0.9327 against the greenback, 92.55 against the yen, 1.4299 against the euro and 1.1390 against the kiwi.
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Forex News
May 22, 2026 14:46 ET Minutes of the latest Fed policy session was the highlight of the week along with survey data on the U.S. housing market. In Europe, survey data signaled the trends in the euro area private sector. Further, consumer price inflation data from the U.K. was in focus. In Asia, various economic indicators from China drew attention to the health of the economy.