Reserve Bank of Australia Governor Glenn Stevens said the government might suspend any interest rates hike at the moment, saying that the current rates are "pretty close" to their average over the past 10 to 12 years.

His comments at a business forum in Toowoomba immediately drew reactions from the markets as the Australian dollar ended lower after Friday's trade while government bond prices surged upward. Betting on a new rate hike in May fell 26 percent later today, from around 40 percent earlier in the week.

In his speech, Stevens said the Reserve Bank moved to raise cash rates for borrowers and depositors to reach the average over the past 10 to 12 years. He said that current interest rates are pretty close to that average.

The Australian dollar fell $US0.9221, from $US0.9255 after Stevens' speech.

The RBA has raised interest rates by 125 basis points since October and the cash rate to 4.25 percent as it aims to normalize interest rates after the economy showed signs of improving.

There were speculations the central bank will announce further rates hike this month and in May.

Several market experts say that the average lending margins were as high as 150 basis points before the global financial crisis that forced the RBA to lower interest rates.

But Stevens pointed out that "one would expect interest rates to be pretty close to average," if the Australian economy grew close to average and inflation were close to the central bank's two to three percent target band.

He estimated that this year would be better than 2009 and the economy to expand wider pointing out that all indicators lead to better performance.