Today’s decision marks the twentieth consecutive month that the cash rate has sat at this record low.
The decision was largely expected given the current economic landscape.
The Australian economy is performing well, experiencing continued employment growth and easing housing credit growth, particularly to investors.
The National Australia Bank’s Business Survey found that business conditions had recorded their highest level since the survey began in March 1997.
Further, data from CoreLogic found that dwelling values fell in six of the eight capital cities over the March quarter led by Sydney, which recorded a 1.7% drop in dwelling values. Hobart continues to record growth, with dwelling values rising 3.4% over the same period.
Abroad, the US federal reserve made the decision to lift the federal fund’s rate, marking the first time in seven years the RBA’s cash rate has been below the fed’s while global share markets experienced volatility amid fears of a global trade war.
These factors considered, support the Reserve Bank’s decision to hold the rate once more.
That being said, a number of factors support the idea that a rate rise is on the horizon.
If you are currently in a home loan you may want to prepare for potential rate rises and try to get ahead on your mortgage repayments while rates are low. In fact, you may want to consider the option of fixing part, or all of your home loan.
If you are hoping to buy your first home, upgrade, or refinance your existing home loan, speak to your local Mortgage Choice broker to ensure you’re in the right product for your immediate and long-term needs.