The Reserve Bank yesterday kept interest rates on hold at the 49-year low of three percent, however the central bank has advised homeowners and borrowers to be prepared for an eventual rate rise at the end of the year.
Glenn Stevens said yesterday that the current rate of three percent was appropriate “for the time being” and that the board will “continue to adjust monetary policy so as to foster sustainable growth in economic activity.”
Treasurer Wayne Swan said that a rise was inevitable as rates are at “emergency levels” and at some stage in the future they can be “expected to move.”
It is believed that Australia’s economy is already performing better than expected, enabling rates to move away from the present “emergency setting.”
Borrowers are being advised to get their affairs in order, while rates are low, to ensure they are prepared when rates eventually start to climb.
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