Reserve Bank makes March Interest Rate Decision
The Reserve Bank of Australia (RBA) has kept the official cash rate on hold at 1.5% in a decision which was widely predicted by economists across the country.
This was even forecast by the RBA governor, Philip Lowe, who made it clear that future cuts were now more unlikely than likely, said Mortgage Choice CEO John Flavell.
“In his opening statement to the House of Representatives Standing Committee on Economics, Mr Lowe suggested that the current monetary policy setting remained appropriate for achieving sustainable growth in the economy.”
Flavell agreed with Lowe in that the Australian economy appeared to be moving along quite well with strong growth in the December quarter. Additionally, consumer sentiment also rebounded slightly in February.
“From this data we can see that the Australian economy is tracking along quite nicely at the moment, so it wasn’t surprising to see the Reserve Bank opt to leave the cash rate on hold for another month,” Flavell said.
However, while the RBA has decided to leave the official cash rate on hold once again, many Australia lenders have recently tweaked their pricing and policy, he added.
“Over the last month, we have seen a number of lenders put additional restrictions on their investment lending, specifically on refinancing in this space.
“In addition, some lenders have lifted the rates across their suite of investment loans in a bid to curb activity in this area. In some instances, we have seen interest rates rise by as much as 25 basis points.”
Looking ahead, Flavell said he expected to see more out of cycle rate movements.