Cash Rate – No change

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

Following a break in January from the regular monthly meetings the RBA has considered a number of factors to assist its decision to leave the Cash Rate as is for the time being.  One important issue is the recent US election result which has influenced a steady improvement in the US stock market.  Recent data on jobs and manufacturing in the US have also been strong and this could result in the US Fed increasing their interest rate at least twice this year following its much-anticipated December rise.

Domestically, our economy is also improving from the poor negative growth during the September quarter – evidenced by the recent trade surplus and strong commodity prices. The property market continues its climb, influenced by a shortage of homes currently available for purchase.

It is our view that due to the above, together with our current low inflation levels, there will be minimal change to the Cash Rate during 2017 before rates start to rise in 2018. The Lenders may, however, decide to increase their interest rates further due to higher borrowing and capital costs.

For more information, or if you would like a free review of your residential, commercial or SMSF loans against other competitive products in the market please contact Peter, David or Simon via this email, our phone: (03) 9882 2500, or visit