The Reserve Bank of Australia has today announced the outcome of its monthly board meeting.
As widely predicted, the cash rate will stay on hold at 2.5 per cent.
Speaking to finder.com.au, AMP Capital’s chief economist Dr Shane Oliver said “not enough has happened to justify moving rates”.
“The line at the end of recent RBA statements has been that 'a period of stability' and recent comments from the RBA governor Glenn Stevens is clearly signalling that rates will stay on hold for some time, and prior to moving rates they would probably change that statement,” he said.
“The next change will probably be a rate hike, not until around sometime June quarter next year ... There's a good chance we won't get back to 5 per cent in this cycle.”
Also speaking to finder.com.au, chief economist at the Commonwealth Bank Michael Blythe similarly said that the RBA continues to indicate it wants a period of stability.
“We have the next change in November, but that will depend on the coming months,” he said.
RP Data’s research director, Tim Lawless, said the cash rate decision has come at a time when value across the housing market is continuing, albeit at a more modest pace compared to last year.
“It is looking increasingly like the official cash rate will remain at its low setting, at least for the remainder of this year, which should continue to support housing demand,” he said.
“Capital gains over the past 12 months were recorded at 10.2 per cent across the combined capital cities; however, we are expecting growth rates to moderate over the coming months as natural affordability constraints and low rental yields in the largest capital cities work to slow the rate of capital gains.”
SUBSCRIBE TO THE SMSF ADVISER BULLETIN
- 21 Aug 2016Risks flagged with real estate appraisal valuesBy Miranda Brownlee
- 21 Aug 2016Lawyer challenges ATO view on two fund strategiesBy Miranda Brownlee
- 18 Aug 2017ATO locks in details, addresses panic on real-time reportingBy Katarina Taurian
- 18 Aug 2017Data feeds unreliable for new reporting, says mid-tierBy Miranda Brownlee
- 18 Aug 2017Tax component confusion spurs potential tax liabilitiesBy Miranda Brownlee
- 18 Aug 2017Contributions triple in June quarter, survey showsBy Staff Reporter
- view all
- ATO locks in details, addresses panic on real-time reporting
The tax office has addressed several points of confusion with the new events-based reporting regime, locked in key deadlines, and outlined w...read more
- Data feeds unreliable for new reporting, says mid-tier
With an estimated 20 per cent of SMSFs still encountering errors from data feeds, one mid-tier firm believes the ATO should allow SMSF pract...read more
- view all