The Reserve Bank of Australia (RBA) today announced it plans to keep the cash rate at 0.1% for yet another month. This is the sixth consecutive month the cash rate has remained at an all-time low.
Despite the housing market showing signs of recovery, the RBA plans to hold this rate at the lowest possible level until 2024 in a bid to stimulate economic growth.
“At its meeting today, the Board decided to maintain the current policy settings, including: the targets of 10 basis points for the cash rate and the yield on the 3-year Australian Government bond; the parameters of the government bond purchase program; and the rate of zero per cent on Exchange Settlement balances.”
Governor Philip Lowe
While the RBA’s record-low cash rate has in turn generated historically low interest rates, a number of lenders are moving away from offering the sub-2% rates that were on the market just a few months ago. Lenders are anticipating a change in the price of money as Australia enters into a new bond period at the end of the June.
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