Interest rates remained on hold again today, 24 September, following the Reserve Bank of Australia (RBA) meeting.
Despite a large 0.5% cut in rates last week in the US and many other world banks already in cutting mode, it was expected by most economists and the market that the RBA would keep the status quo. We should also remember that most other world banks raised rates much higher than the RBA did, so it is only a matter of time before we will need to start the rate cutting process as well.
The tone of the RBA statement today also seems to be less aggressive and defensive about fighting inflation and the possibility of raising rates. Instead, an undertow of “outlook remains highly uncertain” and “restrictive financial conditions continue to weigh on consumption”.
All indications are we have reached the peak in the interest rates and the next move is down. This is all good news for mortgage holders and the real estate market.
About the writer
Ian Pepper has had a long and distinguished career as a finance and real estate professional. Originally trained as a Chartered Accountant in 1995, Ian worked in Sydney and London. He has an MBA from Macquarie Graduate School of Management and now sells real estate with Ray White Helensburgh. Ian also volunteers with local community groups including school P&Cs, sporting clubs and business chambers.