has again chosen to leave the cash rate on hold, in spite of improving labour conditions and a hot property market.
The Reserve Bank has left the cash rate untouched at 2.5%. The announcement echoed economists' expectations. A survey conducted by finder.com.au found economists unanimously expected no change to the official cash rate, but all respondents forecast a rate rise next year, with many betting on a gradual rate rises for the next three years, until it reaches a “new normal” of about 4%.
In its rate announcement, RBA
governor Glenn Stevens
said the Bank chose to again remain on the sidelines due to moderate credit growth and an easing Australian dollar.
Mortgage Choice spokesperson Jessica Darnbrough said that while the surging property market had been cause for concern for the RBA
, recent data made it unlikely the Reserve Bank would move on rates in the immediate future.
"According to the Westpac Melbourne Institute of Consumer Sentiment, confidence fell by 4.6% in September. Furthermore, research conducted by RP data shows housing values eased their way into spring, with the combined capital cities recording dwelling value growth of just 0.1%. While the Reserve Bank has made it clear in recent weeks that something needs to be done to cool the property market, with consumer sentiment down and property price growth easing, it is now unlikely that the Board will cool the property market by raising the cash rate anytime soon," she said.