Strip back all the talk about exchange rates, credit conditions and commodity prices and the Reserve Bank of Australia’s stance on interest rates comes down to one thing: the labour market.

It’s a thread that runs trough the RBA’s pronouncements, including the minutes of its board’s October 7 monetary policy meeting.

The central bank’s charter requires it to keep unemployment low but to safeguard the stability of the currency – that is, to keep inflation low.

If the economy grows too slowly, not enough jobs will be created and unemployment will rise.

But if economic growth is too fast, a dwindling supply of available workers will push wages up, lifting the floor under price rises and the RBA will fail to meet its inflation objective.

It’s no accident that the RBA will rarely raise the cash rate over the course of a year unless the unemployment rate falls over the same 12 months.

And that requires economic growth fast enough to bring unemployment down.

So, what’s growth been like recently?

It was “moderate” in the June quarter and looks to have continued at that pace in the September quarter as well, the RBA said in the minutes.

In central bank jargon, “moderate” growth is faster than “modest”, but not quite at the “trend” rate that’s enough to ensure unemployment won’t rise.

And that lacklustre pace is having predictable effects.

The RBA took in a wide range of indicators and concluded that “conditions in the labour market remained subdued but had stabilised somewhat this year”.

But “it would probably be some time before the unemployment rate declined consistently,” the RBA said.

Thanks to inexplicable volatility in the official figures in recent months, the RBA does not know exactly what the unemployment rate is.

Nor does it know for sure how low it can go without blowing the inflation target through accelerating wage rises.

But the RBA knows that unemployment is currently higher than either of those marks, because wages growth is slowing.

And it does not expect that to change for a while, which is why it will keep its foot on the monetary accelerator with the cash rate at it’s long-time low of 2.5 per cent.

Or, as it said in the minutes in classic central bank-speak, by deciding that “the most prudent course was likely to be a period of stability in interest rates”.