01 May 2017

Australia's Reserve Bank Rate Announcement



North Queensland and Townsville home owners and buyers receive little relief from the Reserve Bank of Australia Board today with their cash rate announcement.

Australia's Reserve Bank has acted on the cash rate as predicted by most reputable economists and retained rates on hold at 1.50 percent today.

With inflation trending higher, a rate rise was unlikely with concerns about unfavourable employment figures and stable prices in global trading of oil and the federal budget soon to the released.

Capital city property prices were a major consideration of the RBA Board as values have increased almost 10 percent since May and August last year.

Despite recent housing data showing property prices in Sydney and Melbourne easing, causing increasing concerns about negative equity risks in the capital city markets.

Easing prices in the capital city markets if sustained over longer periods could be factor for the RBA to increase the cash rate later in 2017 or 2018.

But in the meantime, rates are set to remain on hold unless the economy and jobs growth do not improve economists are predicting, a quarter of whom predict a rate reduction no less than 1.0 per cent.

From a Townsville and North Queensland perspective, a rate cut would have been welcome news for property owners and buyers to stimulate property market demand and bring a glimmer of hope that a redound in sustained values are on the horizon.