Property slowdown gives RBA room for election campaign rate cut

A slowdown in the national property market has delivered the Reserve Bank a chance to slice interest rates in the midst of the federal election campaign as evidence grows of deflationary pressures and consumers winding back their spending.

CoreLogic figures on Wednesday are expected to show dwelling values across the nation's capital cities have fallen another 0.7 per cent through April. That would take prices in Sydney down by 14 per cent since their 2017 peak and by 10 per cent in Melbourne. Lending to owner-occupiers grew by 5.7 per cent over the past year, a 3.5-year low, while lending to investors for housing at 0.7 per cent is the slowest since records began.

"This is a government who's boasted about their strong economic management, but the fact that we're even talking about an interest rate cut shows the anaemic weakness in the current government's economic management." "Furthermore, our budget is back in the black and back on track, with the first surplus in more than a decade.

"Statistical measures of inflation tend to overstate actual inflation by 1 to 2 per cent because statisticians have trouble actually adjusting for quality improvements, and so some measured price rises often reflect quality improvements," he said.deflation. And there are problems with deflation."

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Big banks tipped to hold back some of RBA cash rate cutIf there was to be a cut in the cash rate, experts say it is unlikely the big four would pass the cut on, in full, to their variable rate mortgage customers. When did the banks start doing their own thing with interest? Aussie dollar will drop in price if rba drops rates so no chance that banks will pass on much of rate cut
Source: theage - 🏆 8. / 77 Read more »

Don't expect rate cuts to end the housing slumpHomeowners hoping that a widely-predicted cut in the Reserve Bank’s cash interest rate will breathe some life into the property market will be disappointed. Don't expect RBA interest rate cut. Agree rates will do little so what is going to trigger the credit availability cycle post RC? Probably making the move to please the Government. Even do GUARANTEE. Banks will independently up the Rates Who stopped the banks on previous occasions. ?
Source: theage - 🏆 8. / 77 Read more »

Big banks tipped to hold back some of RBA cash rate cutIf there was to be a cut in the cash rate, experts say it is unlikely the big four would pass the cut on, in full, to their variable rate mortgage customers. When did the banks start doing their own thing with interest? Aussie dollar will drop in price if rba drops rates so no chance that banks will pass on much of rate cut
Source: theage - 🏆 8. / 77 Read more »