An extraordinary of clamour for a rate slash the RBA has adopted a more conservative "wait and see'' approach after two consecutive slash late in last year. Adding by sting in the tail for homeowners is the RBA's decision may courage the big four banks - ANZ, Commonwealth Bank, NAB and Westpac to increase in a move which purposed to protecting their profit levels.

The Australian dollar climbed above $US1.08 immediately after the RBA decision and the stock market were decline about 35 points as investors digested the surprise measure.

Although a clamour from politicians and households for a interest rate cut, the RBA board judged the setting was "appropriate'' as growth was near to trend, lending rates were close to their medium figures average and inflation close to their target level.

Glenn Stevens, RBA governor, said:” the board will observe the data closely over the next coming months, and adjust the cash rate as necessary to supporting sustainable growth and low inflation''.

“ Also the Europe situation were recovery as a rising and stocks markets and the re-opening of global funding markets as being some of the key reasons to defense rates on hold.”

“Still much to be done to put European sovereigns and banks on a health step, but some advance has been made.”

The Australian dollar up more than 0.7 of a US cent after the report. At 2.32pm, the currency was at 107.79 US cents, compared with 107.06 US cents just before the report.

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