A lift in business sentiment combined with strong housing approval numbers has encouraged the Reserve Bank of Australia to leave the official cash rate on hold at 2.5% for the seventh consecutive month.
The Australian economy's ongoing strenght has given the Reserve Bank some much needed confidence in the current monetary policy setting.
The National Australia Bank found in it's latest Monthly Business Survey that business confidence is currently enjoying positive momentum, with business confidence recording its first rise in four months.
Data from the Australian Bureau of Statistics shows home loan approvals are also on the rise, lifting 0.2% in December 2013, and the total number of properties being sold is increasing month on month.
This suggests the Reserve Bank’s previous rate cuts are finally starting to take effect.
Consumer confidence currently remains comfortably in the zone where optimists outnumber pessimists, indicating that the Australian economy is starting to show some real strength.
As such, it is no surprise to see the Reserve Bank of Australia leave the official cash rate on hold again this month, with the expectation that they will err on the side of caution and leave it there for the foreseeable future.
This should encourage a greater number of potential home buyers onto the property ladder as they continue to look to take advantage of the low interest rate environment.
Of course, it is not just potential home buyers that can benefit from the current market conditions.
Call us today on 3366 9982, for a home loan health check, just to make sure your are still in the right product for your needs, or to let us determine how much you can borrow if you are considering climbing that property ladder.