With Spring upon us this weekend our attention is again turned towards the RBA meeting that is taking place next Tuesday.
Interest rates are something that most people will be interested in during their lifetime. As a mortgage holder we are always wanting the lowest rate and as a retiree or investor we are wanting the highest interest rate.
Interest rates play an important role in the monetary policy controls that help to stabalise the economy.
In reading the RBA minutes, although a little long for most people, they are a great summary and insight into the economic conditions that are affecting Australia. They consider both the domestic environment and importantly at the present time the stability of overseas markets.
Europe continues to be on red alert and is far from stability at the moment. America is showing signs of recovery, with house prices recently increasing for the first time in 2 years.
Australia’s economy is quite stable at present. There is certainly economic adjustments going on between different industries, as noted with mass redundancies and restructuring. As harsh as these are they are also a part of the beast that is the economy. Unemployment remains stable, as does economic growth and inflation.
With these things considered it is apparent that rates will more than likely be on hold for the next few months, most certainly at the September RBA meeting. Especially given that we are heading into the “Silly Season” for consumers.
As a mortgage holder you need to weigh up your own personal household circumstances to decide what product and structure is best suited to your needs. Factors such as your job stability, family expenses and unforeseen changes should all be considered.