July 08, 2015
The Reserve Bank of Australia has opted to leave the cash rate on hold at 2% for July, deciding to watch how the Greek crisis, property prices and local consumer sentiment affect the economy.
Following Greece’s failed referendum, the Australian dollar took just 48 hours to drop to its lowest level in six years. Reserve Bank governor Glenn Stevens explained that he wants to watch the rest of the fallout rather than tampering with the cash rate too hastily.
The market here at home also played into the decision to hold the cash rate. Over the next month the board will be keeping a close eye on the hot property markets in both Sydney and Melbourne. Another rate cut would simply add more fuel to the growth of these two markets.
How these factors affect consumer sentiment will be revealed later this month, when the next consumer price index is released. It is likely these findings will play into whether rates change in August.
In Brisbane, the property market is enjoying steadier growth than its southern counterparts. This coupled with historically low interest rates puts buyers in a good position.
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