Brokers: Rate speculation "fuelled by media"

Brokers reacted to yesterday's bank interest rate rises and stronger than expected employment figures with cautious optimism. There was anger, however, at the role the mainstream media had played in stirring up public concern.

"With the media already out there predicting [another rate rise] it's hard to know what [the RBA] are going to do," said Graeme Inglis, principal at Smartline in Pennant Hills, NSW. "I think they've pushed [rates] up too early at the moment."

Lee Seabrook, principal at Aussie in West End, Queensland, blamed the mainstream media for worrying his clients. "A lot of it is fuelled by media," he told Broker news. "Information is good, but I just wish they'd give all of the information."

Seabrook said many clients had wanted to fix their mortgage after hearing reports of rising interest rates on television. None of those clients were aware that fixed rates were already higher than variable rates.
The savvy borrowers, Seabrook said, now opted for loans with low exit costs.

"I'm not in a position to be able to say [any lender] has a particularly good track record and they'll be good going forward," he said. "Let's just try to protect ourselves by having a low out-cost lender. That way you can say, 'If they don't play nicely, we'll move.'"

Inglis said rising consumer sentiment was reflected in the fact that unemployment fell in September from 5.8% to 5.7%. "People are getting more confident, that's for sure," he said. "Most people are comfortable on the variable rate - they're not too concerned about rates skyrocketing."