The Reserve Bank of Australia left its cash rate targetunchanged at 3.75%, saying it needed time to assess the effects of rate risesin late 2009 and increases in bank margins.
But RBA said interest rates would need to rise if theeconomy grows as expected. "If economic conditions evolve broadly asexpected, the Board considers it likely that monetary policy will, over time,need to be adjusted further in order to ensure that inflation remainsconsistent with the target over the medium term,"
RBA Governor Glenn Stevens said. The RBA also noted moves byChina to tighten the monetary screws, saying expansion in major economies islikely to be modest.