Rate Freeze Welcomed
The Adviser has reported that the RBA’s decision to hold the Interest Rate at 3.75% has been received well by brokers, customers, investors and home owners alike. Effectively holding the rates will further help stimulate the economy and provide much needed breathing space for current mortgagees.
The RBA commented that the expensive cost of funding and higher lending rates has prompted them to place a pause on a rate increase for the moment. At the end of the last quarter, inflation figures slowed, with commodity prices falling and building labour costs increasing with the decrease in demand.
Property experts all welcomed the rate pause, with property expected to boom in 2010. Though with such predicted strength this year, inflation and therefore interest rates would keep increasing over time. Simon Reibelt from Oasis Home Loans Northern Beaches said that keeping rates steady at the start of a new year would give everyone confidence and as the year progressed, the economy would rally with this little bit of allowance and power into high gear over the next few months.