Interest Rate Update – June 2018

Cash Rate – No change

The Reserve Bank of Australia (RBA) has just announced it will maintain the official cash rate at 1.50%.

Yesterday we heard that retail sales increased by a better than expected 0.4% in April (against an anticipated 0.3%) and company profits rose 5.9% in the March quarter, influenced in particular by a 11.0% increase in mining profits.   Tomorrow we should see Australia’s GDP figures for the March quarter lift by 0.8% or 0.9%.    Notwithstanding these positive results the RBA remains comfortable to remain on the sidelines, possibly until well into 2019, until we see an increase to both our inflation rate (currently 1.9%) and wages growth.

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