June 06, 2017
No surprises today, with the Reserve Bank of Australia once again choosing to leave the official cash rate on hold at 1.5%.
“This is the 10th consecutive month that the cash rate has been left untouched,” Mortgage Choice chief executive officer John Flavell said.
“Indeed, today's announcement is simply a case of: another month, another unsurprising cash rate decision from the Reserve Bank of Australia.”
Mr Flavell said strong economic conditions would have encouraged the Board to maintain its current stance on monetary policy.
“All the latest economic data has been fairly positive,” he said.
“Consumer sentiment remains relatively robust – despite the fact that we endured a Federal Budget last month that was just an ineffective spray of pops and fizzles.
“Data from the Westpac Melbourne Institute Index of Consumer Sentiment found confidence slid just 1.1% in May.
“In addition, data from the latest National Australia Bank Business Survey found confidence remained high by historical standards.
“On top of this, the latest research by the Australian Bureau of Statistics found the unemployment rate actually fell slightly, hitting 5.7% in April.
“When you combine all of these factors, it is little wonder why the Reserve Bank chose to leave the official cash rate on hold for another month.”
Mr Flavell said today's cash rate decision meant interest rates would continue to sit at historical lows, which is good news for both property buyers and owners.
“With interest rates continuing to hover around record lows, the cost of borrowing remains incredibly affordable.
“Most lenders are still actively competing on price, meaning borrowers can negotiate a good deal on their home loan.”
But while the Reserve Bank decided to leave the official cash rate on hold, keeping mortgage interest rates low, Mr Flavell said it was important for borrowers to do their research and make sure whatever loan they have is the right product for them.
“While the RBA continues to leave the official cash rate untouched, Australia's lenders continue to tweak their interest rates and home loan policies,” he said.
“In recent weeks, we have seen a number of lenders change the policy and pricing across their suite of owner occupied and investor loans.
“With this in mind, it is critical that borrowers do not take a set and forget attitude towards their mortgage. For anyone who has been in the same product for a little while, now is the perfect time to review your options and ensure your product is still the right one for you.”