RBA Interest Rates Announcement

Nov 2016 - AU Home Loan Compare

RBA

The Reserve Bank has left interest rates on hold again over November at the record low 1.5 per cent.

The RBA has adopted a wait-and-see approach while it assesses the impact of recent cuts.

The latest economic data is mixed, with full-time job levels falling, record-low underlying inflation and a stubbornly high currency.

Although the national seasonally adjusted jobless rate is at a three-year low of 5.6 per cent over September, the economy has shed 271,000 full-time workers this year with the participation rate now also falling.

The headline inflation rate increased over the September quarter but underlying inflation fell to record low levels reflecting a stagnant economy.

Home building approvals remain robust, although much of the latest growth is being driven by Sydney units and Melbourne houses.

The trend for retail sales growth has weakened, the Australian dollar is still higher than desirable and the sharemarket remains largely directionless.

 The RBA will be increasingly alert to the resurgence in house prices growth generated by lower mortgage rates.

The Domain Group is reporting strong growth in median house prices over the September quarter in both the Sydney and Melbourne markets with auction clearance rates in those cities rising to boom-time levels over the past month.

Concerns over a continuing underperforming economy will likely result in rate cuts next year.

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