Sydney's 'exuberant' housing market might be in for another boost as Glenn Stevens raised the possibility of a further interest rate cut.

The governor of the Reserve Bank of Australia told the American Australian Association that Sydney prices have reached excessive levels, partly due to "very easy" credit conditions.

"Popular commentary is, in my opinion, too focused on Sydney prices and pays too little attention to the more disparate trends among the other 80 per cent of Australia," he said.

"That said, it is hard to escape the conclusion that Sydney prices up by a third since 2012 look rather exuberant."

Nevertheless, Mr Stevens hinted that another rate cut might be coming, following the Reserve Bank's decision in February to lower the official cash rate from 2.5 per cent to 2.25 per cent.