The Reserve Bank of Australia (RBA) has left the record-low cash rate unchanged at 2.75 per cent following its monthly meeting today.
Governor Glenn Stevens released a statement saying that the board made the judgment based on the most recent global and local information – global growth is running below average and the Australian economy has had to adjust to lower levels of mining investment.
As to what the latest decision will mean for your business, the RBA added that the unemployment rate has indeed edged higher over the last 12 months, and labour costs have remained steady. For these reasons among others, inflation has been consistent with RBA predictions.
“The unemployment rate has edged higher over the past year and growth in labour costs has moderated. Inflation has been consistent with the medium-term target and is expected to remain so over the next one to two years, notwithstanding the effects of the recent depreciation of the exchange rate,” the reserve bank said in its statement.
Ultimately, the board decision is an optimistic one – it stated that financial conditions are expected to ease, and the inflation target is on track.
The chief executive officer of financial product comparison website RateCity, weighed in that the RBA decision is good news for borrowers.
“With interest rates on hold and the start of a new financial year, it is a great time to make a New Year’s resolution to make your money work harder,” Alex Parsons of RateCity said.
By reviewing all of your financial products such as your transaction account, credit card, savings account and insurances, customers stand to save thousands of dollars in interest and premiums. “There’s no point waiting for the Reserve Bank and your lender to offer you a discount when you can switch to better deals and save even more,” Parsons added.