The Reserve Bank of Australia has left the cash rate unchanged at a record low of 2.5 per cent, saying the current setting of monetary policy remained appropriate.
The decision was widely expected, with all 13 economists surveyed by AAP last week forecasting that the RBA would leave the cash rate on hold.
The RBA last cut the cash rate in August, by a quarter of a percentage point.
The Australian dollar ROSE a third of a US cent after the decision, with impact from the US government shutdown also impacting the currency.
At 1435 AEST, the currency was worth 93.74 US cents, up from 93.39 US cents shortly before the RBA decision was announced.
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In a statement accompanying the decision, RBA governor Glenn Stevens said easing of monetary policy since late 2011 had supported interest-sensitive spending and asset values.
He said the effects of previous rate cuts were still working their way through the economy and would continue to do so.
"The pace of borrowing has remained relatively subdued to date, though recently there have been signs of increased demand for finance by households," Mr Stevens said.
"There is also continuing evidence of a shift in savers' behaviour in response to declining returns on low-risk assets."
Mr Stevens said the economy had been growing a bit below trend in 2013 and this was expected to continue as the economy adjusted to the wind-down of the mining investment boom.
"The board will continue to assess the outlook and adjust policy as needed to foster sustainable growth in demand and inflation outcomes consistent with the target," he said.
Full text of the RBA rate decision Rates Statement Statement by Glenn Stevens, Governor:
At its meeting today, the Board decided to leave the cash rate unchanged at 2.5 per cent. Recent information is consistent with global growth running a bit below average this year, with reasonable prospects of a pick-up next year.
Commodity prices have declined from their peaks, but generally remain at high levels by historical standards. Inflation in most countries remains well contained. Overall, global financial conditions remain very accommodative.
Changes in the outlook for US monetary policy have increased volatility in financial markets, but long-term interest rates remain very low and there is ample funding available for creditworthy borrowers. In Australia, the economy has been growing a bit below trend over the past year.
This is expected to continue in the near term as the economy adjusts to lower levels of mining investment.
The unemployment rate has edged higher.
There has been an improvement in indicators of household and business sentiment recently, though it is too soon to judge how persistent this will be. Inflation has been consistent with the medium-term target.
With growth in labour costs moderating, this is expected to remain the case over the next one to two years, even with the effects of the lower exchange rate.
The easing in monetary policy since late 2011 has supported interest-sensitive spending and asset values.
The full effects of these decisions are still coming through, and will be for a while yet.
The pace of borrowing has remained relatively subdued to date, though recently there have been signs of increased demand for finance by households. There is also continuing evidence of a shift in savers' behaviour in response to declining returns on low-risk assets. The Australian dollar rose recently, but is still about 10 per cent below its level in April.
A lower level of the currency than seen at present would assist in rebalancing growth in the economy.
At today's meeting, the Board judged that the setting of monetary policy remained appropriate.
The Board will continue to assess the outlook and adjust policy as needed to foster sustainable growth in demand and inflation outcomes consistent with the target.
