Powered by MOMENTUM MEDIA
subscribe to our newsletter

RBA rate announcement

The Reserve Bank of Australia has announced the result of its monthly board meeting.

The official cash rate has been left at a record-low 2.25 per cent following last month’s 0.25 per cent reduction.

Economists and commentators were fairly evenly split about whether the Reserve Bank board would cut the rate at today’s meeting or leave it on hold.

In a survey by comparison website finder.com.au, 16 of the 37 people surveyed expected a cut while the other 21 expected no change in the cash rate.

The rate-cutting camp noted that the low inflation rate gave the board room to move in an attempt to stimulate the economy and encourage a fall in the Australian dollar.

Advertisement
Advertisement

However, most experts felt the board would be reluctant to give more of a boost to the housing market and would want more time to assess the effects of last month’s rate cut.

St George Bank senior economist Janu Chan was one of those who felt that it was too much to expect back-to-back rate cuts.

“A rate cut over the next few meetings remains possible,” she said. “The strength of non-mining investment, house prices and exchange rates will be the key focus for the RBA over the next few months."

ME Bank’s general manager of markets, John Caelli, said today’s meeting had been a “50-50 call”, but that the board would definitely move in April.

“Rate cuts typically operate in cycles – you can expect more. What’s driving the falls is lower-than-forecasted growth and a desire to keep currency low,” he said.

PROMOTED CONTENT


Bank of Queensland’s head of market analysis, Peter Munckton, also predicted an imminent rate cut.

“The RBA will almost certainly go again in the early months of 2015. Which month the RBA [chooses to] cut will come down to tactical factors, such as the value of the Australian dollar,” he said.

Huw Bough from MyState also forecast another rate cut this year, most likely in April or May.

RBA rate announcement
mortgagebusiness

Latest News

As the new chief and chair are handed the keys in 2022, they will be tasked with continuing the bank’s push for growth in the coming years...

The ACCC has confirmed that three of the big four banks are now accredited data recipients under the Consumer Data Right. ...

The major bank is piloting a zero-interest rate digital credit card, with plans to release it later this year, following similar moves by it...

Join Australia's most informed brokers

Do you know which lenders are providing brokers and their customers with the best service?

Use this monthly data to make informed decisions about which lenders to use. Simply contribute to the survey and we'll send you the results directly to your inbox - completely free!

Do you think APRA's bank buffer changes will see more borrowers use non-banks?

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.