Reserve Bank leaves interest rates unchanged
The official interest rate has been left unchanged for March. The Reserve Bank of Australia met today for their monthly board meeting and opted to leave the cash rate at 3.25 per cent.
The decision could be a sign of strength, as stronger-than-expected international trade and retail figures indicate the economy may be growing slightly despite current world economics. Sales of new homes are up 8.3 per cent in January according to new data from the Housing Industry Association and boosts to the First homeowner grant along with one off handouts in the government's stimulus package may be boosting the local economy. Financial markets were tipping either a 25 basis point cut or a 50 basis point cut. In the past five months official interest rates have been slashed 400 basis points. In October and December rates were cut a whopping 1 per cent, while other months saw smaller cuts.
Each time the RBA cut rates most lenders cut home loan rates and passed on some or all of the cuts to customers. With the rate left unchanged today it is unlikely that banks will cut home loan rates this month.
Some economists did suggest the RBA may leave rates unchanged today but are confident of further cuts in April if the economy does not pick up.
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