Have a Look at The Cash Down by RBA

There was a lot of speculation on the cash rate decision of the Reserve Bank of Australia but it has finally delivered its seventh cash rate for the year. As the calendar year is about to end, the RBA has decided to hold the cash rate at 4.35 percent. The official statement regarding the same was made on Tuesday, 5 November.

Here’s What Eleanor Creagh Said

Before the official statement, forecasters and economists across the nation expected the decision of maintaining the cash rate of the last 12 months. As per the REA Group senior Economist, Eleanor Creagh, the consumer price index for the September 2024 indicated towards inflation that was easing.

In addition to this, it was noted that the movement was “not enough to shift the RBA’s policy stance”. Even with the heading inflation settling into 2-3 per cent target, the price pressure and a resilient labour market will unlikely make an interest rate cut.

Household is under pressure with the sentiments of customers subdued. Interestingly, the employment growth is strong and the unemployment rate is steady at 4.1 percent in September. But the labour market has turned out to be soft over the last year.

More About Economic Growth

Despite the weak economic growth of the nation, the economist focussed that the RBA will remain on hold unless an external shock, high unemployment, or low inflation occurs. In addition to this, the condition aims to sustainably return inflation to target. It has been also noted that slow employment and inflation “may prompt rate cuts from February 2025. It has been emphasized that the “resilient labour market and stickier components of inflation can delay this timeline”. Creagh has noticed that the higher number of properties listed for sale followed by uncertainty of the rate cuts might slow down price growth. In continuation to this, it has been said that the prices are expected to keep rising as the selling season closes out.