Australia’s central bank says interest rates too low after hikes
2 years, 8 months ago

Australia’s central bank says interest rates too low after hikes

Al Jazeera  

Reserve Bank of Australia suggests benchmark rate still too low as unemployment dips to lowest level in nearly 50 years. Australia’s central bank has signalled the need for higher interest rates to tame rising inflation, despite recent rate hikes, as unemployment drops to its lowest level in nearly 50 years. The Reserve Bank of Australia sees the current benchmark rate of 1.35 percent as being “well below” the so-called neutral rate that is neither expansionary nor contractionary, according to minutes of its July policy meeting released on Tuesday. “The level of interest rates was still very low for an economy with a tight labour market and facing a period of higher inflation,” the RBA minutes said. “Members viewed it as important that inflation expectations remained well anchored and that the period of higher inflation be temporary.” The central bank raised the benchmark rate by half a percentage point at its July 5 meeting, the third hike in as many months.

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History of this topic

Has Australia's economy turned the corner? Angus Taylor has a warning
2 weeks, 4 days ago

Has Australia's economy turned the corner? Angus Taylor has a warning

ABC  

Economists say Australia has turned a corner. Last week, he said labour productivity was still "disastrous" in Australia and the purchasing power of our wages had deteriorated "disastrously" since Labor won the election in 2022. By the time the 2022 election was held, the "real" value of our wages had already deteriorated so much that our wages were buying less …

Australia, NZ dlrs scale two-month highs, RBA hawkish on easing
1 month ago

Australia, NZ dlrs scale two-month highs, RBA hawkish on easing

Live Mint  

By Wayne Cole SYDNEY, Feb 21 - The Australian and New Zealand dollars hovered near two-month highs on Friday as worries about a global trade war abated a little, while Australia's central bank sounded a hawkish tone on future rate cuts. "Future rate cuts will likely be more a case of benign inflation readings allowing the RBA to remove the …

Unemployment rate edges higher to 4.1 per cent in January as workforce participation hits record high
1 month, 1 week ago

Unemployment rate edges higher to 4.1 per cent in January as workforce participation hits record high

ABC  

Australia's unemployment rate rose slightly to 4.1 per cent in January, from 4 per cent in December, as more people looked for a job or found work. "The rises in both the number of people employed and unemployed saw the participation rate rise by 0.1 percentage point, to a new record high," ABS head of labour statistics Bjorn Jarvis said. …

RBA delivers first rate cut since 2020
1 month, 1 week ago

RBA delivers first rate cut since 2020

ABC  

Samantha Donovan: Hello, welcome to PM. So what we've seen is those really sticky items in the inflation baskets, I think insurance premiums, out-of-pocket health care costs, the cost of building a new dwelling or rental prices, those price increases have been such that the Reserve Bank has been worried that if it doesn't keep interest rate policy restrictive, and …

Australian shares marginally extend losses after RBA cuts rate as expected
1 month, 1 week ago

Australian shares marginally extend losses after RBA cuts rate as expected

Live Mint  

By Adwitiya Srivastava Feb 18 - Australian shares slightly deepened losses after the local central bank delivered its highly anticipated interest rate cut for the first time in over four years on Tuesday, driven by a sell-off in heavyweight financials. The RBA cut rates by 25 basis points to 4.10%, easing its monetary policy for the first time since November …

Australian central bank cuts benchmark interest rate for the first time since October 2020
1 month, 1 week ago

Australian central bank cuts benchmark interest rate for the first time since October 2020

Associated Press  

MELBOURNE, Australia — Australia’s central bank on Tuesday reduced its benchmark interest rate for the first time since October 2020 as the nation’s inflation cools. “Inflation has fallen substantially since the peak in 2022, as higher interest rates have been working to bring aggregate demand and supply closer towards balance,” the board said in a statement. “Some other central banks …

Reserve Bank cuts interest rates for the first time since November 2020
1 month, 1 week ago

Reserve Bank cuts interest rates for the first time since November 2020

ABC  

The Reserve Bank of Australia has cut interest rates for the first time since November 2020. RBA governor Michele Bullock noted that the rise in interest rates from the "emergency lows" of the pandemic had meant households with home loans were hurting, but argued high inflation caused more pain. At the post-meeting press conference, Ms Bullock said she couldn't confirm …

Why the Reserve Bank has little option but to cut interest rates
1 month, 1 week ago

Why the Reserve Bank has little option but to cut interest rates

ABC  

After more than six months of conjecture and on-again off-again signals, interest rates are about to start a descent. In the December quarter, core inflation came in at just 0.5 per cent which, if you annualise it, comes in at just 2 per cent, smack bang at the bottom of the RBA's target range. Core inflation has dropped rapidly, more …

The RBA hasn't changed the cash rate for more than a year. Here's why
1 month, 2 weeks ago

The RBA hasn't changed the cash rate for more than a year. Here's why

ABC  

The cash rate target — a figure that influences how high people's mortgage repayments are set — hasn't changed for more than a year. That's why, when inflation started increasing rapidly in Australia, the RBA began lifting interest rates to stop inflation getting worse — and to drag inflation back down into the 2–3 per cent range. The RBA raised …

Inflation has fallen in Australia and NZ, but which is faring better?
1 month, 2 weeks ago

Inflation has fallen in Australia and NZ, but which is faring better?

ABC  

New Zealand's economy is in recession. But inflation has fallen in both countries, and Australia's Reserve Bank is expected to start cutting interest rates soon. For example, New Zealand's labour force hasn't grown in the past 12 months, but you wouldn't know that by looking at its unemployment rate. Therefore, you could argue that New Zealand's unemployment rate is obscuring …

Rate cut chances increase after inflation slows in final quarter of 2024
1 month, 3 weeks ago

Rate cut chances increase after inflation slows in final quarter of 2024

ABC  

The odds of an interest rate cut next month have increased, with official figures showing the Reserve Bank of Australia's preferred measure of inflation fell to 3.2 per cent over the year to December. The more volatile headline inflation figure came in at 0.2 per cent for the December quarter and 2.4 per cent for the year, down from a …

Interest rates, exporters and Reserve Bank intervention: There's a lot at stake as the Australian dollar weakens
2 months, 3 weeks ago

Interest rates, exporters and Reserve Bank intervention: There's a lot at stake as the Australian dollar weakens

ABC  

Is the Reserve Bank close to stepping into the currency market to support the Australian dollar and, if so, what does this mean for millions of Australians? Reserve Bank can intervene to support the dollar The Reserve Bank last intervened in the foreign exchange market in 2007-08 during the global financial crisis, when it bought Australian dollars. "This was in …

RBA chief's major hint that there could soon be some VERY good news ahead for home-owners
3 months ago

RBA chief's major hint that there could soon be some VERY good news ahead for home-owners

Daily Mail  

The Reserve Bank has given a strong hint borrowers are getting some interest rate cuts in 2025 even though inflation is still too high. The Reserve Bank has given a strong hint interest rate cuts are coming even though inflation is still too high While headline inflation is at a three-year low of 2.8 per cent, the RBA regarded this …

RBA Is More Confident on CPI, But Too Early to Declare Victory
3 months ago

RBA Is More Confident on CPI, But Too Early to Declare Victory

Live Mint  

-- Australia’s central bank is more confident that inflation is moving sustainably toward target but it’s still too soon to conclude the battle is won given a recent pick-up in consumption and a still-tight labor market, minutes of the December meeting showed. The Reserve Bank’s board discussed scenarios in which future policy would be eased to boost economic growth or …

The Australian dollar could be heading to a 20-year low, on risks of China, Trump and slow growth
3 months ago

The Australian dollar could be heading to a 20-year low, on risks of China, Trump and slow growth

ABC  

You wouldn't be an economics forecaster for quids. A weak Chinese economy, American threats to impose punishing trade tariffs, a poor medium-to-longer-term outlook for our key exports and a sluggish economy are likely to keep the Australian dollar under pressure through 2025, threatening to send it into the 50 US cents. The upside of heading down The Australian dollar is …

Share market rises after a rally on Wall Street, Australian dollar remains at two-year low — as it happened
3 months ago

Share market rises after a rally on Wall Street, Australian dollar remains at two-year low — as it happened

ABC  

OK, so a lot of this discussion is couched in coded messages. They noted that the data received since the previous meeting had not been sufficient to shift the central forecast for inflation or the labour market materially at this stage." "Relative to this central path, members judged that the risk that inflation returns to target more slowly than forecast …

NZ recession and Federal Reserve rate cut sink Aussie dollar but show the RBA dodged a bullet
3 months, 1 week ago

NZ recession and Federal Reserve rate cut sink Aussie dollar but show the RBA dodged a bullet

ABC  

If you're looking for a last-minute overseas summer getaway, New Zealand is looking increasingly attractive. On the monetary policy front, the Reserve Bank of New Zealand started lifting its cash rate from COVID-19 lows of 0.25 per cent in October 2021 — a full seven months before Australia's Reserve Bank. Why a Fed rate cut sent the US dollar soaring …

Surge in wages means beleaguered borrowers must wait for interest rates cut
Trending News
3 months, 1 week ago

Surge in wages means beleaguered borrowers must wait for interest rates cut

The Independent  

For free real time breaking news alerts sent straight to your inbox sign up to our breaking news emails Sign up to our free breaking news emails Sign up to our free breaking news emails SIGN UP I would like to be emailed about offers, events and updates from The Independent. Read our privacy policy The Bank of England is …

The RBA is preparing for all economic scenarios, including an interest rate hike
3 months, 2 weeks ago

The RBA is preparing for all economic scenarios, including an interest rate hike

ABC  

The Reserve Bank may have dropped the phrase "not ruling anything in or out" in its interest rates commentary, but that does not mean an interest rate hike is completely out of the question. That is because, as Dr Hunter explained, it would mean the RBA's key policy goal of achieving its mid-point annual inflation target of 2.5 per cent …

Australia's unemployment rate falls to 3.9pc in November, its lowest level since March
3 months, 2 weeks ago

Australia's unemployment rate falls to 3.9pc in November, its lowest level since March

ABC  

Australia's unemployment rate fell to 3.9 per cent in November, down from 4.1 per cent in October. "The only downside to Australia's remarkably strong job market is that any hope of a near-term interest rate cut is over," said Callam Pickering, APAC economist at global job site Indeed. "Today's blockbuster November employment report seemingly pushes back — yet again — …

Major blow for Aussies just before Christmas as Reserve Bank makes interest rate decision
3 months, 2 weeks ago

Major blow for Aussies just before Christmas as Reserve Bank makes interest rate decision

Daily Mail  

Australian home borrowers have been dealt a severe blow just before Christmas with the Reserve Bank denying them a rate cut. Governor Michele Bullock gave a strong hint rate cuts could be months away with inflation still too high, ahead of an election next year. Australian home borrowers have been dealt a severe blow just before Christmas with the Reserve …

Reserve Bank keeps interest rates on hold in December but leaves door open to a February cut
3 months, 2 weeks ago

Reserve Bank keeps interest rates on hold in December but leaves door open to a February cut

ABC  

The Reserve Bank has left interest rates on hold in December for a ninth-straight meeting, but opened the door to a rate cut as soon as February. This is a change in language from the board's November statement, which said it needed to "remain vigilant to upside risks to inflation" and was "not ruling anything in or out". "While the …

The brutal reality of life under Anthony Albanese as economy grows at weakest pace in more than three decades
3 months, 3 weeks ago

The brutal reality of life under Anthony Albanese as economy grows at weakest pace in more than three decades

Daily Mail  

Australia's economy is barely growing despite record-high levels of immigration and government spending, as the country enters its longest-ever per capita recession. Australia's economy is still barely growing despite record-high immigration levels The Australian Bureau of Statistics data showed GDP per capita shrank by 1.5 per cent over the year, continuing a per capita recession that began in early 2023 …

Why the bout between the Reserve Bank and the federal government is about to heat up
3 months, 3 weeks ago

Why the bout between the Reserve Bank and the federal government is about to heat up

ABC  

There's an old adage that oppositions don't win elections, governments lose them. RBA Governor Michele Bullock says Australia's strategy of reducing inflation without stoking too much unemployment is part of the reason why it looks different to peer economies right now. RBA unlikely to react to October inflation data Photo shows Household money pic Australia's inflation rate remained steady in …

The politics of the RBA's independence means a struggle over Australia's economic outlook is being fought in the shadows
3 months, 3 weeks ago

The politics of the RBA's independence means a struggle over Australia's economic outlook is being fought in the shadows

ABC  

When the prime minister fronted the media just after 8am on Friday, the sense of elation was palpable. We now live in a world where the sainted independence of the RBA is such that the treasurer can't even be seen to be giving it a few "helpful suggestions" about interest rates. He says for the RBA's wage forecast to be …

RBA unlikely to lower interest rates in 2024 despite inflation at its lowest level since July 2021
4 months ago

RBA unlikely to lower interest rates in 2024 despite inflation at its lowest level since July 2021

ABC  

Australia's inflation rate remained steady in October, with analysts tipping this price data won't change the Reserve Bank's mind to hold interest rates at their highest level in about a decade until at least early 2025. The inflation rate held at 2.1 per cent annually, with the rising price of food, alcohol, cigarettes and recreational activities keeping it up, while …

Why Australia is lagging the pack on rate cuts
4 months, 1 week ago

Why Australia is lagging the pack on rate cuts

ABC  

At last, some good news. Despite core inflation still sitting well above target, there's a better than even chance the official cash rate will be cut within weeks. But when it came to the all-important core inflation measure, America's came in at 3.3 per cent, again just a couple of points below us at 3.5 per cent. Immediately after the …

Big hint Anthony Albanese is responsible for you missing out on a rate cut - with Australia's most powerful banker blaming government spending for inflation
4 months, 2 weeks ago

Big hint Anthony Albanese is responsible for you missing out on a rate cut - with Australia's most powerful banker blaming government spending for inflation

Daily Mail  

Australia's most powerful banker has given a strong hint that excessive government spending is to blame for high inflation, ruling out rate cuts until 2025. Australia's most powerful banker has given a strong hint excessive government spending is to blame for high inflation - and therefore no rate cuts While headline inflation has fallen to a three-and-a-half year low of …

Sharply rising bond rates could stem Wall Street's 'relief rally' and push interest rate cuts further into the future
4 months, 2 weeks ago

Sharply rising bond rates could stem Wall Street's 'relief rally' and push interest rate cuts further into the future

ABC  

The apparent roar of approval was almost deafening. It's a world that, down the track, promises a return of inflation and permanently higher interest rates as America shifts to a more protectionist global stance that punishes China and, by extension, hurts Australia. Since mid-September, US money markets almost inexplicably have begun forecasting a rise in interest rates. The bond is …

Interest rates might fall in February … but don't bet the house on it
4 months, 3 weeks ago

Interest rates might fall in February … but don't bet the house on it

ABC  

It's the hope that kills you. Rate cuts may not come until autumn, if they come at all Now even a February rate cut is looking unlikely, according to the money markets, which are pricing just 20 per cent chance of a cut, despite all four big banks and many other local economists forecasting it. Markets are pricing in a …

RBA leaves cash rate at 4.35pc, acknowledging it's 'restrictive,' while ASX loses ground — as it happened
4 months, 3 weeks ago

RBA leaves cash rate at 4.35pc, acknowledging it's 'restrictive,' while ASX loses ground — as it happened

ABC  

Here are some highlights from the RBA Board's statement. Underlying inflation remains too high: "Inflation has fallen substantially since the peak in 2022, as higher interest rates have been working to bring aggregate demand and supply closer towards balance. "Headline inflation was 2.8 per cent over the year to the September quarter, down from 3.8 per cent over the year …

Review finds 'no evidence' gunshots were deliberately edited into commando footage — as it happened
Trending News
4 months, 3 weeks ago

Review finds 'no evidence' gunshots were deliberately edited into commando footage — as it happened

ABC  

Treasurer Jim Chalmers answers a questions on the RBA interest rates. Member for Macquarie, Susan Templeman, asks: "What does the decision taken today by the Reserve Bank mean for Australians and what progress is being made in the fight against inflation and how does this compare to other approaches?" "Secondly, it reflects the progress that we are making together in …

Reserve Bank keeps interest rates at 4.35pc for eighth-straight meeting despite lower inflation
4 months, 3 weeks ago

Reserve Bank keeps interest rates at 4.35pc for eighth-straight meeting despite lower inflation

ABC  

The Reserve Bank of Australia has kept interest rates on hold at 4.35 per cent for its eighth-straight meeting, despite inflation falling to its lowest level in almost four years. In a statement, the RBA said while inflation has "fallen substantially" since it peaked in 2022, underlying inflation remained too high at 3.5 per cent in the September quarter. The …

Who is to blame for Australia's inflation problem and stubbornly high interest rates?
4 months, 3 weeks ago

Who is to blame for Australia's inflation problem and stubbornly high interest rates?

ABC  

What, or more precisely who, is to blame for the inflation episode that has up-ended our lives for the past three years? In all the noise this week about electricity prices, and the federal government assistance that has temporarily kept energy bills in check, we've overlooked one of the persistent driving forces behind our elevated inflation. Interestingly, both relate to …

The cheapest home loan interest rate in Australia as banks slash rates
5 months, 3 weeks ago

The cheapest home loan interest rate in Australia as banks slash rates

Daily Mail  

Australian borrowers tempted by lower fixed rate mortgages should not jump in too soon, amid predictions of even better deals on offer in 2025. Macquarie Bank on Thursday slashed its two and three-year fixed rates by 20 basis points to 5.39 per cent - now Australia's lowest mortgage rate outside of a green loan. But their lowest fixed rates are …

The great New Zealand rate hike experiment and where it all went wrong
5 months, 3 weeks ago

The great New Zealand rate hike experiment and where it all went wrong

ABC  

You have to hand it to the Kiwis. In NZ, interest rates have started to fall Photo shows Skyscapers make up a very business end of town skyline As Australian mortgage holders wait for relief, the Reserve Bank of New Zealand cuts rates and green shoots emerge in the housing market. RBA keeps interest rates at 4.35pc Photo shows Reserve …

No RBA rate cut yet, but Governor Bullock is about to find the pressure overwhelming
6 months ago

No RBA rate cut yet, but Governor Bullock is about to find the pressure overwhelming

ABC  

Who'd want to be Reserve Bank Governor Michele Bullock? Reserve Bank keeps interest rates on hold at 4.35pc Photo shows Reserve Bank of Australia generic The RBA has kept interest rates on hold at 4.35 per cent, saying inflation is still too high to start cutting rates. The Reserve Bank board has decided to keep the cash rate steady at …

Reserve Bank keeps interest rates on hold at 4.35pc, ignoring political pressure for cut
6 months ago

Reserve Bank keeps interest rates on hold at 4.35pc, ignoring political pressure for cut

ABC  

The Reserve Bank has left interest rates on hold at 4.35 per cent. Earlier this month, Treasurer Jim Chalmers said the RBA's rate hikes were "smashing the economy", and former Labor treasurer Wayne Swan accused the RBA of "putting economic dogma over rational decision-making" by refusing to cut rates at this point in the cycle. "With the labour market still …

These numbers are the clues to the Reserve Bank's puzzle: when will interest rates go down?
6 months ago

These numbers are the clues to the Reserve Bank's puzzle: when will interest rates go down?

ABC  

Perhaps no question matters more to Australians worn down by three years of relentless cost pressures: when will the Reserve Bank cut interest rates? But not too much – which is why when inflation shoots high, the Reserve Bank raises interest rates to suppress demand by making it more expensive to borrow and spend. But the Reserve Bank prefers a …

How the US Federal Reserve rate cut could impact the race for the White House between Harris and Trump
6 months, 1 week ago

How the US Federal Reserve rate cut could impact the race for the White House between Harris and Trump

ABC  

The US Federal Reserve has cut rates in a dramatic move that will have a major impact on the American economy and could help determine who occupies the White House for the next four years. By cutting rates by half a per cent, the Fed has signalled it thinks the battle against the high inflation that has plagued the US …

Why is the US cutting interest rates? What does it mean for Australia?
6 months, 1 week ago

Why is the US cutting interest rates? What does it mean for Australia?

ABC  

The US Federal Reserve has cut interest rates overnight in an important move for the global economy. Economists predicted the Fed would want to start cutting rates before inflation hits 2 per cent because there's a long lag time between interest rate movements and their effect on the economy. It means the Reserve Bank's cash rate target, which sits at …

Why the Reserve Bank will be forced to cut rates before year's end
6 months, 2 weeks ago

Why the Reserve Bank will be forced to cut rates before year's end

ABC  

Until just a few weeks ago, it seemed as though the developed world had pulled off what once was thought to be the impossible. And yet, despite this mounting evidence of a critical economic slump, there remains a rump of high-profile economists openly criticising the Reserve Bank of Australia's reluctance to push interest rates above 5 per cent. Parliament House …

Labor is leaning into an assault on the 'barbarians' at the bank. It may be great politics, but the economics are trickier
6 months, 2 weeks ago

Labor is leaning into an assault on the 'barbarians' at the bank. It may be great politics, but the economics are trickier

ABC  

There's plenty of buyer's remorse inside Labor these days. Treasurer Jim Chalmers has blamed successive interest rate rises for "smashing the economy", as the government braces for more weak economic figures due this week. Failure to bring inflation back to the bank's 2 per cent to 3 per cent target range would ultimately force the Reserve Bank to "slow the …

More people are seeking help as Australia's economy slows down, RBA governor acknowledges
6 months, 3 weeks ago

More people are seeking help as Australia's economy slows down, RBA governor acknowledges

ABC  

Reserve Bank governor Michele Bullock says she is aware that more people than usual are seeking help from community organisations as Australia's economy slows down and unemployment rises. And the number of owner-occupiers with variable-rate mortgages who are in a "particularly challenging situation" is also rising, but the RBA is doing what it can to bring inflation down, re-balance the …

The RBA is making confusion about inflation and the cost of living even worse
6 months, 3 weeks ago

The RBA is making confusion about inflation and the cost of living even worse

ABC  

There's a paradox about the way we respond to threats to the cost of living. At the same time, when the cost of living climbs enough to push inflation beyond the Reserve Bank's target, the bank pushes up interest rates in an attempt to drive measured inflation down. Sharp interest rate increases are a problem The response of the Reserve …

The US is about to start cutting interest rates, so expect Australia to follow
6 months, 3 weeks ago

The US is about to start cutting interest rates, so expect Australia to follow

ABC  

Just three weeks ago, Reserve Bank Governor Michele Bullock declared interest rate cuts unlikely in the next six months. But if there was any doubt about what's going to happen to global interest rates, the US Federal Reserve chair Jerome Powell removed it on Saturday. Rate cuts by the US Fed and other central banks will create a near-irresistible pressure …

Fresh warnings Australia's economy could be on path to recession
7 months ago

Fresh warnings Australia's economy could be on path to recession

ABC  

There are fresh warnings that Australia's economy is on a path toward a recession. Employers are seeing a surge of applicants as unemployment rate climbs to 4.2 per cent Photo shows Melbourne CBD people retail shopping The unemployment rate climbs to 4.2 per cent in July, despite data from the Australian Bureau of Statistics showing more than 58,000 people found …

Why Reserve Bank of Australia boss Michele Bullock is refusing to consider cutting rates soon - even though mortgage holders in New Zealand, Canada, UK and EU have already had some relief
7 months, 1 week ago

Why Reserve Bank of Australia boss Michele Bullock is refusing to consider cutting rates soon - even though mortgage holders in New Zealand, Canada, UK and EU have already had some relief

Daily Mail  

The woman who decides the fate of millions of mortgage holders has declared a rate cut won't be happening anytime soon - despite what other countries have done this year. Reserve Bank Governor Michele Bullock told a parliamentary hearing on Friday that Australia would not be copying the approach of other central banks that have cut rates this year, with …

Finance guru Mark Bouris makes worrying admission about Australia
7 months, 3 weeks ago

Finance guru Mark Bouris makes worrying admission about Australia

Daily Mail  

Finance guru Mark Bouris has claimed that Australia has been in a recession for the past 18 months with the standard of living the worst its been in two years. Finance guru Mark Bouris has claimed that Australia has been in a recession for the past 18 months The cash rate is currently at a 12 year high of 4.35 …

The RBA has avoided the worst-case scenario with interest rates but economic uncertainty is looming
7 months, 3 weeks ago

The RBA has avoided the worst-case scenario with interest rates but economic uncertainty is looming

ABC  

That's the thing with silver linings. Here's how it happened Even with the carnage of the past few days, our market is only off 1.5 per cent since the start of the financial year, while some US indices are still in the black, giving an indication of just how fast stock markets have been running in recent weeks. Annual inflation …

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