With RBA Governor Glenn Stevens accompanying statement leaning more towards the dovish direction, potential interest rate cuts of around 50 basis points for the coming 12 months is now in line with expectation.
The Reserve Bank of Australia (RBA) announced on Thursday that it registered a $1.076 billion profit in the last financial year. It is a turnaround from the $4.889 billion loss the central bank logged the previous financial year.
"The large valuation losses sustained on the Reserve Bank's own balance sheet in the preceding year were not repeated, and the Bank returned to profit," RBA Governor Glenn Stevens said in the RBA yearly report.
With the $500 million dividend declared by the central bank, it boosted the chances of federal budget returning to surplus by the end of June 2013.
The annual report also disclosed that Mr Stevens earned $995,142 for the financial year, slightly down from the previous year's $1.02 million due to fewer pay weeks for the past 12 months.
The release of the yearly report also came a day after the minutes of the September RBA meeting were published. The publication led to futures markets forecasting a 60 per cent chance that the RBA will cut rates in October.
However, some economists believe the RBA would wait until November for a decision on the anticipate rate reduction to give the central bank a chance to observe how developments in China's economy and commodity prices would affect its decision.
RBA also reported underlying earnings of $710 million, slightly lower than the $897 million the previous year.
"In nominal terms, underlying earnings are at their lowest level since before the float of the Australian dollar, reflecting the extremely low level of interest rates around the world," RBA said.
This article is copyrighted by IBTimes.com.au, the business news leader