Official cash rate kept at 2.5%

Reserve Bank governor Graeme Wheeler has kept the official cash rate at 2.5% in his debut review.

But he is keeping close tabs on the level of inflation, after it dropped below the bank's target band in the September quarter.

Wheeler says the bank expects inflation to head back toward the middle of the target range.

He says it will continue to closely monitor inflation indicators, such as pricing intention and inflation expectation data, in the coming months.

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