RBA may leave rates on hold as Sydney house prices soar

Sydney

PHILIP Lowe has some high-powered backing if he leaves interest rates on hold on Tuesday as widely expected.

Days after the Reserve Bank of Australia (RBA) governor signalled that rate cuts weren't in the national interest amid record household debt, the securities regulator said it was looking at mortgage lending standards across the banking sector.

The Organisation for Economic Co-operation and Development (OECD) last week highlighted risks posed by Australian property and private debt.

Sydney house prices have soared 73 per cent in the past five years, ranking it second only to Hong Kong as the world's least affordable housing market, while Melbourne prices shot up 52 per cent in response to the RBA's multi-year easing cycle. The central bank had sought to steer economic growth away from mining investment and towards Australia's traditional services industries led by exports of tourism and educati…