RBA may wait to raise rates
Saturday 7 February 2004
The Reserve Bank of Australia (RBA) may signal that a slowing housing market and a rising currency has reduced the urgency to raise interest rates when it presents its quarterly statement on the economy on Monday.
By The LandlordMarket participants are eagerly awaiting the Statement on Monetary Policy, the first from the central bank this year, to gauge the outlook for interest rates and the economy.
The RBA raised the benchmark interest rate by a quarter of a percentage point in November, after holding it steady for 16 months and followed with another hike in December.
Economists are forecasting at least one more quarter percentage point rise in the first half of this year but the RBA stayed its hand, keeping the key rate at 5.25 per cent, when board members met this week.
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The Government announced its long awaited tenancy law reforms today and they mean that landlords will no longer be able to get rid of tenants without reason.
There’s no sign of a slow-down in Wellington’s property prices with Trade Me Property’s latest data showing that asking prices continue to rise solidly.
Vacancy rates in the commercial property sector are set to increase as changing economic conditions dampen demand.
LVR restrictions were never meant to be a permanent feature of New Zealand’s housing market and ANZ economists argue that some further relaxing of them could soon be on the cards.