Interest rates on hold as Australia's lowest paid workers welcome a wage rise

The Reserve Bank of Australia has kept interest rates steady at a record low of two percent, with the door left open for future cuts.

The RBA today decided not to reduce the official cash rate by 0.25 percent, confirming recent speculation by local economists.

Macquarie Private Wealth advisor Martin Lakos told 9NEWS another rate cut to 1.75 percent in November was expected.

"The reason why we think that far out is the Reserve Bank is going to really let these rate cuts get some traction," he said.

RBA Governor Glenn Stevens says the future economic information will show if "the current stance of policy will most effectively foster sustainable growth".

It follows the announcement by the Fair Work Commission earlier today that the 1.86 million Australians paid the minimum wage would get a 2.5 percent increase, the equivalent of an extra $16 a week.

That brings the weekly minimum wage to $656.90, or just over $34,000 a year.

Two thirds of bosses say they will raise wages by less than three percent this year.