RBA to consider CPI data before rate decision

The Reserve Bank of Australia (RBA) says it will use next week’s Consumer Price Index to decide if it is appropriate to cut interest rates at its next meeting.

The Australian Bureau of Statistics is due to release its consumer price index for the first quarter of 2012 on April 24.

In the minutes of its April board meeting, the RBA said that it had lowered its assessment of economic growth since it last eased rates in November.

“If slower growth in demand could be expected to result in a more moderate inflation outcome, then a case could be made for a further easing of monetary policy,” the RBA said.

“The board would have the opportunity at its next meeting to review the inflation outlook based on comprehensive new data on prices, as well as information on demand and output.”

The RBA said it had noted sharp differences in performance between sectors and regions of the economy, and considerable structural change occurring, as well as soft overall conditions in the housing sector.