It was the RBA Governor, Glenn Stevens, last meeting today prior to stepping down from his RBA role and with rates at an all-time low, the outcome was generally predicted as a hold. But with plenty of “crazy” happening around the globe right now, you really just don’t know!
As per our ‘Loop Alerts’ last month, many of the banks decided to pocket more than ½ of the last RBA cash rate cut leading to limited speculation a surprise cut could happen. The result of a brisk meeting was to leave the official cash rate on hold at 1.50%. It really wasn’t the Sound of Music we were hoping for (BTW – we know you are humming in your head right now). The bank last moved on rates in August with a 0.25% cut.
As per our announcement last month, a number of banks held on to some of that last cut. We explain why in our article on why it’s important for banks to make a profit here in Australia.
Noted in the announcement was that the global economy overall continued to grow at a lower than average pace, and although several advanced economies have recorded improved conditions, some of the emerging market economies are seeing challenges. It’s not all bad, just not on the up at a fast rate, and as such they’re holding firm. Wondering what the interest rate cuts mean overall? Check out our article.
Low interest rates have been supporting demand locally here in Australia, and the resulting lower exchange rate for our Dollar is seeing exports on the improve. It was also noted that Banks and other financial institutions are in a position to lend for worthwhile purposes. Our economy is starting to make the right kind of adjustments overall, but they are definitely watching what is happening with our exchange rate.
On to property, and specifically loans and mortgages, and the RBA see that strengthened lending standards in the housing market are helping to cool the market overall. A number of lenders are also taking a more cautious attitude to lending in certain segments. The best available information suggests that dwelling prices overall have risen moderately over the past year and growth in lending for housing purposes has slowed. Considerable supply of apartments is scheduled to come on stream over the next couple of years, particularly in the eastern capital cities.
If you already have a home loan, please remember that when rates are this low, it’s always wise to revisit what your current rates are to ensure you’re still getting the best deal available for your needs. Here’s why. Whilst we don’t like to toot our own horn, we always go in hard on negotiating better than advertised interest rates. We also have some pretty good “street cred” with the banks/lenders which often afford us better discounts than the average broker or bank manager. Yep, as the saying goes, it can come down to who you know!
So, if you are looking to buy, refinance, fix your interest rate or invest in property, Loop in with our expert team and we’ll find the most competitive product for your needs. Get in touch with us now through one of the methods below: