The Reserve Bank of Australia has kept its benchmark interest rates at the highest level of 4.75 percent as typhoon floods continue to hamper coal mining in the Northeast and the competitive currency eases inflation fears.

Reserve Bank of Australia Governor Glenn Stevens held the overnight cash rate target at 4.75 percent for a fourth straight meeting today.

He called the level "mildly restrictive" and appropriate given the economy's outlook.

Stevens said in a statement announcing the decision: "The natural disasters over the summer have reduced output and the resumption of coal production in flooded mines is taking longer than initially expected. Commodity prices, including oil prices, have risen over recent months, pushing up measures of consumer price inflation in many countries."

The surging mining investment pulled up the value of the Australia's dollar to a record this week, but it also reduces the economy's spare capacity and further fiscal tightening is needed.

The Australian dollar was little changed after the decision, trading at $1.0323 at 3:15 p.m. in Sydney from $1.0327 before the announcement.

Employment growth "has moderated," inflation is consistent with the central bank's goal and the currency's strength is helping ease prices pressures, he said. The impact of Japan's crisis on Asia's economy is "expected to be limited," Stevens said.

The RBA, which raised rates seven times from October 2009 to November last year, is pausing as the country recovers from flooding and cyclones in the state of Queensland. Australia's economy accelerated 0.7 percent in the fourth quarter, from a revised 0.1 percent three months earlier.