Tuesday 5th December 2017RBA to Stay on the Sidelines
The Reserve Bank of Australia (RBA) is set to make history and remain on the interest rate sidelines over the coming year despite international pressure to lift its official cash rate, says mortgage broker network 1300HomeLoan.
1300HomeLoan Managing Director John Kolenda said the RBA has now kept official interest rates at an all-time low of 1.5 per cent since the last rate movement in August, 2016.
Mr Kolenda said the previous longest period on the sidelines for the RBA since it first published a cash rate target in January, 1990, was between August, 2013, and February, 2015, when official rates dropped 25 basis points to 2.25 per cent.
“The RBA hasn’t lifted its cash rate for more than seven years and a generation of mortgage holders hasn’t experienced a hike in official interest rates,” Mr Kolenda said.
“While it has come under recent pressure to begin increasing the cash rate from none other than the Organisation for Economic Development (OECD), the RBA’s interest rate strategy since the Global Financial Crisis should be commended.”
Mr Kolenda said the RBA maintaining its holding pattern on official rates has provided much needed stability for mortgage holders.
“Hopefully we will see the central bank maintain its highly cautionary approach in 2018 which will keep any potential increases at a miniscule amount and over a protracted period to avoid causing unnecessary panic among mortgage holders,” he said.
Mr Kolenda said while official rates remain low, the lending environment remained highly competitive and home loan customers should seek expert advice from a mortgage broker to secure a better deal and save money.