The Reserve Bank, in its quarterly statement on monetary policy on Friday, kept its underlying inflation forecasts comfortably within its 2 per cent to 3 per cent target range, suggesting there is scope to cut the cash rate further if needed.

As in Tuesday's board meeting statement, when it left the cash rate unchanged while most economists had expected a cut, the RBA said ''the stance of monetary policy remained appropriate, for the time being''.

National Australia Bank senior economist David de Garis said the RBA clearly retained a bias to lower rates. But having cut the cash rate in October and then left it unchanged this week, ''for them to do an about-face and ease in December, without some new game-changing information, would be unusual to say the least'', he said.

The RBA said the outlook for the economy was a ''little weaker'' than predicted three months ago and its revisions were largely as a result of it now forecasting an earlier, and lower, peak in mining investment.

Over the year to June 2013, the economy is expected to grow at 2.75 per cent, the bottom end of a previous 2.5 per cent to 3.5 per cent forecast range made in August.

In year-average terms, as used by federal Treasury, growth is forecast at 3 per cent for 2012-13, matching the government's forecast in the midyear budget review released last month.

However, the central bank warned that risks to the global outlook remain tilted to the downside amid the ongoing European debt crisis and the impending US fiscal cliff - when automatic spending cuts and tax increases come into play. AAP