Interest Rate Announcement 2nd July 2013

The Reserve Bank has decided to leave interest rates on hold for the second consecutive month following the May decision to cut rates to a record low 2.75 percent.

Housing markets generally continue to rise off the back of low rates with buyer activity in Sydney, Melbourne and Perth at its highest level for some years.

“Although the economic outlook remains mixed, recent data has been positive for interest rate settings including an improvement in the unemployment rate and a lower dollar. Although activity in the resources sector is expected to moderate the outlook for the international economy is gradually improving.

A consolidation of recent modest improvements in the jobs market would be required to ease concerns over the medium-term direction of the national economy. As a consequence the current bias on short-term interest rate movements still remains slightly downwards despite today’s decision to leave rates unchanged”, says Dr Andrew Wilson, Senior Economist for Australian Property Monitors.

“Most local housing markets however continue to benefit from low interest rates with rising winter buyer activity”.