Cash rates to remain at 4.25%

In line with most Economists predictions the Reserve Bank board kept the cash rate on hold at 4.25% for a third consecutive month today.

Glenn Stevens, the Reserve Bank Governer,  did hint the Reserve bank could cut the rate next month, saying in a statement that if demand conditions "weakened materially, the inflation outlook would provide scope for easier monetary policy".

The RBA last eased the cash rate by 25 basis ponts in December and Economists believe two further easings during 2012 is likely.