In a widely expected move, the central bank left the official cash rate at 4.5 per cent for the fourth straight month during today's board meeting.

Governor Glenn Stevens said the interest rates paid by borrowers were around their average levels of the past decade.

''With growth in the near term likely to be close to trend, inflation close to target and with the global outlook remaining somewhat uncertain, the board judged this setting of monetary policy to be appropriate for the time being,'' he said.

He said underlying inflation was likely to be in the top half of the board's 2-3 per cent target zone until mid next year, ``while [consumer price index] inflation will probably be just above 3 per cent for a few quarters due to the impact of the tobacco tax changes''.

Mr Stevens said the Australian economy had been growing at about trend pace, ''helped by high levels of public spending over the past year but private demand has also been firming''.

''The high level of the terms of trade is boosting incomes, which will tend to add to demand over the year ahead, while the effects of earlier expansionary policy measures will be diminishing. Indications are that business investment in particular could increase strongly,'' he said.

Economists believe the Reserve will resume raising rates either later this year or next year, as the economy builds momentum from the renewed mining boom.

The decision comes after a new survey showed the construction industry remained weak.

The Australian Industry Group-Housing Industry Association construction index fell 0.1 per cent to 43.2 in August, remaining below the 50-point mark that separates expansion from contraction.

All major sectors went backwards in the month, including house building, which fell to its lowest reading in 16 months - to 38.4.

''Poor market demand, reduced work from school building projects together with intense competition to secure existing contracts impacted negatively across construction resulting in a drop in new orders, deliveries and selling prices,'' it said.

Industry Group public policy director Peter Burn said decline in the house building sub sector was of particular concern.

''The industry remains hampered by the failure of private demand to take up the slack left by the dwindling number of new public sector projects and the withdrawal of additional support for first home buyers,'' he said.