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interest ratesThe Reserve Bank has decided to keep interest rates on hold, despite fears of the Australian economy struggling outside the mining sector.

With instability in the European markets and concerns over a double-dip recession in the US, the RBA decided to keep official interest rates at 4.75 percent.

RateCity CEO Damian Smith said the decision to keep rates on hold is good news for homeowners and prospective buyers.

"With the number of property sales and mortgages plummeting this year, keeping the cash rate unchanged should give some confidence to both groups," Mr Smith said.

"It’s important that current borrowers use any rate pause wisely – paying down debt by increasing your monthly repayments is a tried and tested formula.

"For those about to enter the property market, having the highest possible deposit saved will help you reduce the impact of any future rate rises."

The Reserve Bank last raised rates by 25 basis points in November 2010.

Source: www.ninemsn.com.au

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