Not surprising, the RBA has decided to keep the cash rate ON-HOLD today in their monthly meeting – meaning that homeowners will have to face another month of interest rates at their current levels. This does not come as a surprise as in line with our findings last week – most economists predicted that that a rate cut was unlikely given the present state of the economy.
Although conditions are being worsened somewhat by the recent sharp slide of the Australian dollar – highlighting a growing lack of confidence in our economy with interest rates predicted to fall further – the move to reduce interest rates is being viewed as a last resort by the RBA with rates already at historical levels. Furthermore, although improvements in consumer confidence data and housing approvals were not what the RBA expected following its other policy decisions this year – there is still a little bit of further room for results to deteriorate before any action is required.
