Today's RBA Decision & Will Trump increase your mortgage rate?

December 06, 2016

RBA Hold Rates at 1.5%

The RBA have just announced cash rates will hold at 1.5%.  This remains the lowest rate in the RBA's history.  

The RBA's key messages - inflation is low, coupled with patchy house price growth (doesn't feel like it in Melbourne!) and tougher bank lending standards working to keep the national housing market under control, thus no need to increase rates. See the full Reserve Bank statement for full details.  

 

Will Trump' Presidency increase your mortgage rate?

Trump's US election winning platform was to Make America Great Again.  Consensus is that, as the ABC puts it,  "The prospect of a debt-fuelled, inflation-generating, infrastructure spending spree, along with big cuts to US tax rates, have raised the likelihood that interest rates (in Australia) are on the way up."  Others would say it will simply remove pressure on the RBA to reduce rates further.

As we know, lender interest rates don't always follow the RBA's actions.  Some banks have already nudged their rates up, from late November. Nothing significant and maybe a one-off for the time being, but it's an indication of slightly more uncertain sentiment going forward.

Any changes would affect all types of debt - mortgages, car loans, credit cards, asset finance etc. Make sure your budget has room for possible higher repayments, should your interest rates increase. 

 

As always, please call or email me if you'd like to discuss any aspect of your finances - mortgages, personal or business loans, car finance, asset finance (buying assets for your business).  

Cheers, Marvin    marvin.coleman@mortgagechoice.com.au

Posted in: Interest rates

Contact us today.


Additional Comments? * :