Rates are now on hold - but it doesn’t sound like it will stay that way much longer. This is what the RBA board spoke about earlier this week.
Global inflation is too high, particularly in the services sector which he called “worryingly persistent”, and recent banking sector drama in the US and Switzerland was just another challenge for the global economy.
He reiterated the Australian banks and APRA’s cry that the domestic banking sector was unquestionably strong and had ample liquidity reserves to handle any bumps. He noted that APRA required banks to cover interest rate risk, and said that was something offshore regulators should also rethink.Australian household consumption growth was strong in the June and September quarters last year, which is when the official cash rate was only starting to rise from its pandemic-era low of 0.1 per cent.
Those repayment buffers, he warned, were unevenly spread across households. He said about 30 per cent of home owners had less than three months’ buffer in their redraw or offset accounts.Wages growth is higher than it was a few years ago. However, Lowe said recent high inflation had not been driven by excessive wages growth.
The board will meet again on May 2 in Perth, where it sounds like the economy is charging along. Banking bosses are returning from Perth with stories of labour shortages and housing shortages – and the two shortages together create a worker housing shortage that’s a significant problem for employers.
Malaysia Latest News, Malaysia Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
RBA hold interest rates to give Board ‘more time’ to assess economic outlookReserve Bank Governor Philip Lowe says the decision to hold interest rates steady this month was taken to give the Board “more time” to assess the economic outlook and the impact of the increases in interest rates so far. “Since May last year interest rates have been increased by three and a half percentage points,” Mr Lowe said. “That’s a very large increase over a very short period of time and I acknowledge that it’s been very difficult for many people.”
Read more »
Macquarie cuts home loan rates after RBA pauseMacquarie Bank has announced it will reduce the majority of its fixed home loan interest rates by up to 0.3 per cent per annum, providing further relief for homeowners after the Reserve Bank opted against raising interest rates on Tuesday.
Read more »
‘It’s a hard message but it’s the truth’: RBA governor defends previous rate risesReserve Bank Governor Philip Lowe says if the RBA did not put up interest rates, “inflation will stay high”. “Interest rates will have to go higher later on and there’ll be more unemployment,” Mr Lowe said during a National Press Club address. “This rise in interest rates has been necessary, and if we didn’t do it then there’s more pain down the track. “It’s a hard message but it’s the truth.”
Read more »
RBA hits pause on official interest rate at 3.6% but says further rises may be neededCash rate on hold as the Reserve Bank indicates it will monitor state of economy and the outlook before lifting borrowing costs further
Read more »
'Fear of missing out energy' offsets RBA hikes, property analyst claimsA property economist believes buyers who have been cautiously waiting on the sidelines are now again on the move. 9News
Read more »