RBA slashes cash rate to historic low

Tuesday's RBA cut marked the third reduction in the cash rate in five months. Now at a historical low of 0.75%, Sydney developers and apartment purchasers alike are eager to know if banks will pass this reduction on and make accessing funds easier in a recovering property market.

The long-expected move follows months of signals from governor Philip Lowe that the Reserve Bank was prepared to push rates lower to increase employment and lift stubbornly low inflation back into the 2-3% target band.

This marked the third reduction in the cash rate in five months.

Lowe said it was “reasonable to expect that an extended period of low interest rates will be required”, suggesting the RBA is “prepared to ease monetary policy further”.

Lowe said the economy had reached a “gentle turning point”, with growth a little higher over the first half of this year than over the second half of 2018.

“The low level of interest rates, recent tax cuts, ongoing spending on infrastructure, signs of stabilisation in some established housing markets and a brighter outlook for the resources sector should all support growth,” he said.

If banks pass this interest rate cut on, accessing funds will become easier for property developers and purchasers alike. Contact Matt Otway on 0424 199 009.

Source: The Guardian