Interest Rate Cut – June 2019

 In Uncategorized

RBA Announce Interest Rate Cut

With the uncertainty of the federal election behind it, the RBA has decided to reduce the official cash rate to 1.25% as it tries to stimulate household spending and the economy. This is the first rate move since August 2016 and I’d like to share some thoughts on why the Reserve Bank of Australia has made this decision.

In making this decision the RBA has taken into account inflation being below its target range of 2-3%, continued pressure on house prices, evidence of rising levels of mortgage stress, a borrowing squeeze in response to the Banking Royal Commission, slow wages growth and continued concerns around the level of under employment.

Here is a table showing how Australia’s average mortgage sizes may be affected:

 

 

 

 

 

 

Lenders continue to review rates independently of the RBA with some already making reductions in anticipation of the RBA decision. It is therefore important to review your lending options regularly to ensure they remain the most suitable for your situation. There may be different rates available from our wide panel of lenders and we’re always available to ensure you have the right financial solution for your current and future circumstances, if you’d like to have a chat about what today’s news means for you and your finances, please don’t hesitate to get in touch with one of our friendly brokers on 1300 308 225

For more information about today’s announcement see: https://www.rba.gov.au/media-releases/2019/mr-19-15.html

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