The Reserve Bank has cut interest rates today by 0.25 per cent.
The
official interest rate is now 3.5 per cent.
The 25 basis point fall comes after a big 0.5 per cent cut last month that,
as yet, has failed to make an impact.
The softness in the non-mining sectors of the economy has forced the Reserve
Bank to move again today. Many people are hurting and have been hoping the
Reserve Bank would make the decision it has.
Each 0.25 per cent drop in
interest rates slices about $60 off the monthly interest cost of an average
Australian mortgage.
The cut may not be the last for the year. It has been predicted the Reserve
Bank will cut rates by as much as 1 per cent this year, taking the official rate
as low as 2.75 per cent.
The big question now is, just how much of today's rate cut will lenders pass
on?
Last month the average cut delivered was 0.38 per cent, despite the Reserve
Bank slashing rates by 0.5 per cent.
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