RBA leaves rates on hold at 3 per cent again THE Reserve Bank kept official interest rates on hold today, in a widely expected move reflecting growing economic confidence overseas and at home. The board of the Reserve Bank left the cash rate at 3 per cent for the fourth month, having lowered Australia's official interest rate by 1.25 percentage points last year to bolster Australia's economy as the peak of the resource boom approached. The dollar fell by US0.1c after the RBA decision. At 2.32pm AEDT, the Aussie was at $US1.045, down from $US1.046 shortly before the bank's decision was announced. Since the Reserve Bank considered the level of interest rates in March the probability of further rates cuts this year has fallen substantially, amid signs the economy is generating jobs at a rapid pace and previous rate cuts are starting to work. Rising house and share prices are boosting consumer confidence, and retail sales in January suggested Australians are starting to spend more after a period of restraint. Cyprus's clumsy bank bailout doesn't appear to have destabilised Europe's tepid economic recovery, and policies to spur growth in the US appear to be working. Traders in financial markets are putting only an 80 probability of an interest rate cut over the next 12 months, as a stubbornly strong Australian dollar and low and stable inflation give the Reserve Bank an excuse to cut further. Current discounted variable mortgage rates, at 5.65 per cent, are at their lowest levels in in decades, expect for a period through 2009.