At its monthly meeting today, the Reserve Bank board decided to leave the cash rate unchanged at 1.50 per cent.
When handing down the decision RBA Governor Philip Lowe said conditions in the global economy had improved.
"Labour markets have tightened and above-trend growth is expected in a number of advanced economies, although uncertainties remain.
"Growth in the Chinese economy is being supported by increased spending on infrastructure and property construction, with the high level of debt continuing to present a medium-term risk. Australia's terms of trade are expected to decline in the period ahead but remain at relatively high levels.
"Wage growth remains low in most countries, as does core inflation. Headline inflation rates are generally lower than at the start of the year, largely reflecting the earlier decline in oil prices."
Mr Lowe went onto say the Australian economy expanded by 0.8 per cent in the June quarter. This outcome and other recent data are consistent with the Bank's expectation that growth in the Australian economy will gradually pick up over the coming year.
"Over recent months there have been more consistent signs that non-mining business investment is picking up. A consolidation of this trend would be a welcome development.
"Business conditions as reported in surveys are at a high level and capacity utilisation has risen. A large pipeline of infrastructure investment is also supporting the outlook.
"Against this, slow growth in real wages and high levels of household debt are likely to constrain growth in household spending.
"Employment has continued to grow strongly over recent months. Employment has increased in all states and has been accompanied by a rise in labour force participation. The various forward-looking indicators point to solid growth in employment over the period ahead, although the unemployment rate is expected to decline only gradually over the next couple of years."
Mr Lowe said following some tightening in credit conditions, growth in borrowing by investors has slowed a little recently.
"In the housing market, conditions continue to vary considerably around the country. Housing prices have been rising briskly in some markets, while in others they have been declining.
"In Sydney, where prices have increased significantly, there have been further signs that conditions are easing. In the eastern capital cities, a considerable additional supply of apartments is scheduled to come on stream over the next couple of years. Rent increases remain low in most cities."
Mr Lowe said that taking account of the available information, the Board judged that holding the stance of monetary policy unchanged at this meeting would be consistent with sustainable growth in the economy and achieving the inflation target over time.