Reserve Bank of Australia (RBA) Assistant Governor Christopher Kent said on Monday that the central bank's monetary policy was working despite strong headwinds like "the significant decline in mining investment, fiscal consolidation at state and federal levels and the exchange rate".

He pointed out that rising house prices in combination with strong growth of credit are potential risk for Australia's economy.

"Consumption growth has picked up since 2013. But it is still a little weaker than suggested by historical experience," the RBA assistant governor said.