SYDNEY, Feb. 6 (Xinhua) -- The Reserve Bank of Australia (RBA) has decided to keep the country's cash rate on hold at 1.5 percent on Tuesday, citing low wage growth and uncertainty around household consumption as the major reasons.
February now marks the 17th consecutive month Australia's interest rate has remained at the record low level.
"With both CPI and underlying inflation running a little below 2.0 percent, inflation is likely to remain low for some time," RBA Governor Philip Lowe said.
"However a gradual pick-up in inflation is expected as the economy strengthens," he added.
"The central forecast is for CPI inflation to be a bit above 2.0 percent in 2018."
Although debt levels remain high with income growth slowly increasing, Lowe said that business conditions remain positive along with the outlook for non-mining business investment.
He also pointed to increased public infrastructure spending, international trade and strength in Asian economies like China as supportive of Australia's economy.
Already weakened by lower-than-expected retail sales data for the month of December, the Australian dollar fell from 78.74 U.S. cents before the read at 14:30 (AEDT), to 78.62 U.S. cents immediately after.