The central bank of Australia raised its interest rate in May by +0.25% for the third time in 2010 meaning the interest rate is now 4.5%.

This is the sixth increase since it became the first in the Group of 20 nations to raise rates in October 2009. The Reserve Bank of Australia met on the 4th May 2010 and its members stated that it would be prudent to undertake some further monetary tightening, which would result in lenders changing their interest rates to reflect those similar to the average levels over the past decade.

Central bank members said: "Increases in interest rates to date had been timely. There were some early signs that they were beginning to affect behaviour, with retail sales subdued and housing loan approvals falling noticeably."