Australia's central bank held interest rates at record lows on Tuesday as sliding commodity prices, a still-high currency and mounting economic uncertainty in China argue for continued stimulus, and even the chance of more cuts.
The Reserve Bank of Australia (RBA) underlined the need for a lower currency after its monthly policy meeting, even though it had only just hit a six-year trough on the U.S. dollar.
"Further depreciation seems both likely and necessary, particularly given the significant declines in key commodity prices," said RBA Governor Glenn Stevens.
On the outlook for policy, a typically guarded Stevens repeated that coming data would "inform" the bank's assessment of whether the current level of rates was most effective.
He also declined to go into detail on the implications of economic ructions in Greece and China, saying only that they had not yet had much impact on sovereign borrowing costs.
The decision was well flagged as a Reuters poll of 22 analysts had found all expected rates to remain at 2 percent, though six looked for another easing by Christmas.
Interbank futures imply a 50 percent probability of a move by October, rising to 80 percent in December.
The central bank has already eased twice this year as the unwinding of a once-in-a-century mining boom carves a gaping hole out of business spending and national income.
Lately, data have suggested mining spending is falling even faster than first thought, while industry confidence has been sapped by a sharp retreat in prices for key resource exports, notably iron ore.
Adding to the unwelcome mix has been a tumble in Chinese shares which risks dampening consumer confidence in Australia's largest export market. The Shanghai share index has fallen by around 30 percent in the last three weeks despite ever-more aggressive attempts by Beijing to stem the rout. All of which adds to the case for a lower currency.
The Aussie dollar did finally break down to a six-year low of $0.7533 this week and could well be heading to $0.7300, according to a Reuters poll of 55 analysts.
Still, the background is not all dark. The hundreds of billions lavished on mining is driving a sustained increase in export volumes, underpinning growth even as prices fall.
Super-low mortgage rates have lit a fire in the housing market where approvals to build new homes are running at all-time highs and national prices are growing 10 percent annually.
Government tax breaks for small business announced in May were well received and helped boost new vehicle sales to a record peak in June.
Perhaps most encouragingly, the labour market has surprised with its strength and pushed the jobless rate down to a one-year low of 6.0 percent in May. Annual employment growth of 2.0 percent almost matches that of the United States.
The June jobs report is due on Thursday and confirmation of the improving trend would likely go some way to easing the central bank's concerns over the economy.