head of corporate affairs, Belinda Williamson, says there are ‘plenty’ of positive signs of an emerging market uplift in conditions, particularly in sectors of the economy that correlate closely to interest rate movements like housing finance market.
“The decision by the Reserve Bank to leave the cash rate at 3% in March, as expected by majority of market commentators, need not be seen in a negative light by anyone watching the property market. We are seeing encouraging signs in the economy that should lead to further positive consumer and business sentiment.”
However, the Housing Industry Association (HIA) is describing the move as a ‘missed opportunity’ for those employed in the struggling residential construction industry.
HIA senior economist, Shane Garrett, says this week’s building approval release from the ABS reinforces that a sustained residential construction recover is still a ways off.
“What's good for the residential construction market is good for the wider economy. International factors have squeezed many sectors of the Australian economy and this calls for further action from the RBA. The tool of interest rate intervention is blunter now than it has been in previous downturns.”