Australian central bank keeps rates at 2.75%

Australia's central bank kept interest rates at a record low 2.75 percent on Tuesday, adopting a wait-and-see approach to a lower Aussie dollar and the impact of earlier cuts on the economy. The Reserve Bank of Australia (RBA) left the door open for further cuts in an unusually brief memo leaving the official cash rate at 2.75 percent -- a level unseen since the 1959 start of the RBA. RBA governor Glenn Stevens said last month's surprise 25-basis-point cut had seen the stubbornly high Australian dollar come off the boil but there was further unwinding ahead. "The exchange rate has depreciated since the previous board meeting, although... it remains high considering the decline in export prices that has taken place over the past year and a half," Stevens said. "The board judged that the easier financial conditions now in place will contribute to a strengthening of growth over time." Stevens noted that soft inflation conditions "may provide some scope for further easing, should that be required to support demand", leaving more cuts on the table by judging current monetary policy as "appropriate for the time being". Inflation was 2.5 percent on-year in the first three months of 2013 with growth running at 3.1 percent amid warnings that mining investment -- Australia's key economic driver -- is nearing its peak. Stevens said growth remained at below-average pace, according to recent data, with unemployment edging higher and borrowing subdued. "The easing in monetary policy over the past 18 months has supported interest-sensitive areas of spending and has been reflected in portfolio shifts by savers and higher asset values," he said. "Further effects can be expected over time." The Australian dollar -- which recently ended a record 2.5-year run at or above parity with the greenback -- was little changed by the decision, fetching 97.25 US cents.