THE Reserve Bank has keep the cash rate on hold for the second consecutive month, but has kept the door open for further cuts if they are needed to stimulate the economy.
The cash rate remained at 2.75 per cent, a 53-year low, after the last RBA cut in May.
Financial markets were pricing in a 14 per cent chance of a 25-basis-points cut today, according to Credit Suisse data.
A majority of economists had expected the central bank to stay its hand, after a sharp fall in the Australian dollar over the past few months helped to ease the pressure on export-oriented sectors of the economy.
Since the last RBA cut in May, the Australian dollar has slipped more than 10 per cent against its US counterpart, with currency strategists not expecting it to return to its above parity levels.