Reserve says Australian economy doing 'pretty well'

A SENIOR Reserve Bank official says Australia's economy is going "pretty well", and interest rate cuts are doing their job.

The bank's deputy governor Philip Lowe says interest rate cuts tend to take a while to feed through into improved economic growth, but most of the signs are there that the RBA's previous rate cuts are working.

"The available evidence does suggest that lower interest rates are doing their work broadly as expected," he said.

Dr Lowe has pointed to a rise in house prices, mortgage lending and auction clearance rates over the past six months, a surge in share prices and a strong recovery in consumer confidence as signs the RBA's six rate cuts, totalling 1.75 percentage points, are having an effect.

The Reserve's deputy governor also notes that the Australian economy has been performing reasonably well, even before the rate reductions fully feed through.

Read more at ABC news online.