BREAKING: The Reserve Bank has held official interest rates steady for the first time in a year, delivering some pre-Easter relief to the nation’s home buyers.
Credit:The bank has lifted the cash rate at its past 10 consecutive meetings. On an average $600,000 mortgage, repayments have climbed to almost $3600 a month over that period. In April last year, monthly repayments on the same mortgage were $2370., the RBA decided to hold the cash rate this month.“The board expects that some further tightening of monetary policy may well be needed to ensure that inflation returns to target,” he said.
“Growth in the Australian economy has slowed, with growth over the next couple of years expected to be below trend,” he said. “We are facing an unpredictable environment and businesses should not assume rate rises are over. Inflation remains high and previous rate rises will continue to have an effect,” he said.
“The board remains alert to the risk of a prices-wages spiral, given the limited spare capacity in the economy and the historically low rate of unemployment. Accordingly, it will continue to pay close attention to both the evolution of labour costs and the price-setting behaviour of firms.” Senior ANZ economist Adelaide Timbrell said confidence among those paying off a mortgage fell another 2.1 points as previous interest rate rises started to hit the hip pockets of borrowers.“Confidence in financial conditions, particularly current financial conditions, is now trending lower than it was during the initial COVID outbreak as ongoing inflation and the rapid rise in the cash rate bites household budgets,” she said.
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