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Cash rate steady on 1.5 percent
Borrowers will enjoy another month of interest rate stability, after the Reserve Bank's decision this week to once again hold the Official Cash Rate steady on 1.5 per cent.
In a statement announcing the decision, RBA Governor Philip Lowe remarked on the continuing adjustment in established housing markets, after the earlier large run-up of prices in some cities.
"Conditions remain soft and rent inflation remains low, while credit conditions for some borrowers have tightened a little further over the past year or so.
RBA Governor Philip Lowe
At the same time, the demand for credit by investors in the housing market has slowed noticeably as the dynamics of the housing market have changed. Growth in credit extended to owner-occupiers has eased. Mortgage rates remain low and there is strong competition for borrowers of high credit quality."
Taking into account these factors and that inflation remains low and stable, the Board sees no need to change policy – for now. Economists are predicting there may well be another drop before the end of the year.