Australian central bank kept interest rate unchanged

On Tuesday, Australia's central bank kept its interest rate unchanged at 3.85%. This decision shocked market participants, as many had previously forecast a cut, as reported by Reuters. The move was driven by the regulator's desire to gather more information about inflation slowing in the country.

Following the meeting, the regulator announced that six members voted to maintain the current interest rate, while three officials voted against it. Such division of opinions is rare for the central bank's board.

According to Reuters, market participants had generally expected the rate to be cut to 3.60% during the regulator's meeting. Such a move would have been justified by Australia's inflation slowing to the 2–3% range. Meanwhile, consumer spending in the country came in below expectations.

Moreover, current economic uncertainty stemming from US tariffs also influenced the bank's final decision. Thus, the Reserve Bank of Australia is attempting to support the country's economy amid risks of global GDP growth slowdown.