November Reserve Bank Announcement: CASH RATE REMAINS ON HOLD

November 04, 2014
Nicole Spiteri

 RBA continues to leave rates on hold

Poor sentiment encourages RBA to leave cash rate untouched


Despite a small increase in consumer sentiment this month, the fact that pessimists continue to outweigh optimists has provided the Reserve Bank of Australia with enough reason to leave the official cash rate on hold.


At its Board meeting earlier today, the RBA announced its plans to leave the official cash rate on hold at 2.5 per cent for the 15th consecutive month.  


Local Mortgage Choice franchise owner Des Nation said the decision to leave the cash rate untouched was largely unsurprising given how weak consumer sentiment has been of late.


“According to the most recent Westpac Melbourne Institute Index, consumer sentiment rose by just 0.9 per cent in October,” Mr Nation said.


“This is the eighth consecutive month that the Index has printed below 100, which means pessimists continue to outnumber optimists.


“But while the latest Index clearly shows Australian consumers are caught in a period of ongoing pessimism, the current sentiment reading is higher than expected given that the Australian dollar and the Australian share market have fallen approximately 6 per cent over the last month.”


And it isn’t just consumer confidence that is hovering at low levels. Mr Nation said National Australia Bank’s Monthly Business Survey found business confidence lost ground in September.


“According to the report, business confidence is now sitting at a level not seen since before the federal election. Furthermore, business conditions fell in September, taking the Index to its lowest level in four months,” he said.


These disappointing business and consumer confidence conditions have ultimately forced the Reserve Bank of Australia to leave the official cash rate on hold for yet another month.


Moving forward, Mr Nation said that while the Reserve Bank has talked openly about the potential to introduce certain measures to cool the property market, it is unlikely that one of the measures they will use in the immediate future is a cash rate hike.


“It is now highly unlikely that the Board will raise the cash rate anytime soon as this may further negatively impact consumer sentiment,” Mr Nation said.


 “So, with rates still on hold and set to stay this way for the short term, now is a great time for those with a mortgage to review their home loan and make sure they are still in the most suitable product for their needs.


“Similarly, if you would like to get onto the property ladder, now is a good time to do so.”


If you want to learn more about your home loan options, call us on (02) 9833 8177 or visit


For further information, photos of the new logo, or to arrange an interview, please contact:

Des Nation

Mortgage Choice   

0412 709 700

 Important information

This article is for general information purposes only. It has been prepared without considering your objectives, financial situation or needs. You should, before acting on the advice, consider its appropriateness to your circumstances.

 About Mortgage Choice

Mortgage Choice is an ASX listed company that seeks to help Australians with all of their financial needs.

Established in 1992, Mortgage Choice was originally established to help Australians improve their financial situation by offering a choice of home loan providers, coupled with the expert advice of a mortgage professional.

Since that time, the company has grown and developed into a fully fledged financial services provider.

Today, Mortgage Choice helps customers source car loans, personal loans, credit cards, commercial loans, asset finance, deposit bonds, and risk and general insurance.

Further, the company offers Australians access to real, relevant and affordable financial advice through our qualified financial advisers.

Mortgage Choice has no balance sheet or funding risk, and consistently delivers strong profits and attractive yields. It listed on the ASX in 2004 (MOC) and is a member of the Mortgage & Finance Association of Australia (MFAA).

Mortgage Choice holds an Australian Credit Licence: no. 382869 and Mortgage Choice Financial Planning Pty Limited holds an Australian Financial Services Licence: no. 422854. Both licences are issued by ASIC.

Recent recognition: 2014 Australian Broking Awards Best Diversified Program; 2013, 2012, 2011 Australian Broking Awards Major Brokerage of the Year – Franchise; 2013, 2012 Australian Broking Awards Best Ethical/Social Responsibility Program; 2012 Australian Broking Awards Best Training and Education;   No.1 on The Adviser magazine’s 2012, 2011, 2010 and 2009 Top 25 Brokerages list; 2012, 2010, 2009, 2008, 2006 and 2005 MFAA Awards Retail Aggregator/Originator of the Year; 2011, 2010, 2009 and 2008 10 Thousand FEET Top 10 Franchise list; 2010 Forbes Asia-Pacific Best Under A Billion list.

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