RATES TO STAY

Written on the 18 February 2010

RATES TO STAY

THE Reserve Bank of Australia (RBA) has made an unexpected move to leave interest rates unchanged today at 3.75 per cent.

RBA governor Glenn Stephens says the decision was made because lenders have been charging above the cash rate and the effects are still uncertain.

“Lenders have generally raised rates a little more than the cash rate over recent months and most loan rates have risen by close to a percentage point,” says Stephens.

“Since information about the early impact of those changes is still limited, the board judged it appropriate to hold a steady setting of monetary policy for the time being.”

But in his statement issued today Stephens hinted at further rate rises if the economy continues to recover as expected, as interest rates to most borrowers are still lower than average.

“If economic conditions evolve broadly as expected, the Board considers it likely that monetary policy will, over time, need to be adjusted further in order to ensure that inflation remains consistent with the target over the medium term.”

Suncorp Bank executive manager Tim Buckett says if the economy continues to strengthen the RBA will likely move rates back to normalised levels over the next six to eight months.

“The low rates seen throughout 2008-09 during the economic crisis were simply not sustainable in the long-term for Australia,” he says.


Latest News

ENTREPRENEUR'S NEW VENTURE SWEET AS 'HONEE'

A MELBOURNE entrepreneur hailing from the food tech scene has launched a new venture to change the face of beauty....

WATER VENTURE TAKES ON THE PLASTIC SCOURGE

DAMIEN Stone has a thirst to build the world's biggest social enterprise in a clean fight against the plastic ...

BUNNINGS BOSS JOHN GILLAM QUITS WESFARMERS

THE man behind Bunnings' home improvement domination has resigned from his role in charge of the retailer.

...

NOVOTEL SALE REFLECTS HOT BUYERS' MARKET

AFTER two decades in the hands of a private syndicate, The Novotel Melbourne Glen Waverley has been sold to the Sy...

Related News

HOW MCDONALD'S AUSTRALIA REDISCOVERED ITS INNOVATIVE SPIRIT

MCDONALD'S is such a ubiquitous part of the Australian landscape today that it is easy to forget how it change...

JB HI-FI IS THE GOOD GUY IN $870 MILLION ACQUISITION

ELECTRONICS giant JB Hi-Fi has formally completed its $870 million acquisition of home appliance chain The Good Gu...

ACCC ACTS AGAINST MERITON'S RIGGED REVIEWS

MERITON Property Services is under fire from Australia's main consumer watchdog, after it allegedly engaged in mi...

ACCC FIRES WARNING SHOT TO IVF PROVIDERS

IVF clinics have been put on notice by consumer watchdog, the Australian Competition and Consumer Commission (ACCC...

Contact us

Email News Update Sign Up Contact Details

Subscribe to our mailing list

* indicates required
Email Format

PO Box 2087
Brisbane QLD 4001

LoginTell a FriendSign Up to Newsletter