Interest Rate Update

Declining Housing MarketThe Reserve Bank Board decided to leave official cash rates at 2.0% at todays monetary policy meeting. In his statement accompanying the release Governor Glen Steven said,

“In Australia, the available information suggests that the economy has continued to grow over the past year, but at a rate somewhat below its longer-term average. In such circumstances, monetary policy needs to be accommodative.”

The Governor went on to say, “Dwelling prices continue to rise strongly in Sydney, though trends have been more varied in a number of other cities. The Bank is working with other regulators to assess and contain risks that may arise from the housing market.”

In other words, Sydney property prices might continue to boom but interest rates won’t be going higher anytime over the next year.

“by Shane Clinton”

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