Banks Respond to RBA’s December Rate Cut
To the joy of property owners the RBA on Monday cut the variable cash rate by 0.25% following a weakening jobs market, sluggish retail sales and a slowdown in the mining sector. The cash interest rate now matches where it was during the worst of the GFC and has not been any lower than where it currently is since the year 1990.
Banks have slowly come to market and released their own interest rate cuts in response. The list is as follows:
CBA: 0.20%, NAB 0.20%, ING 0.25%, St George 0.20%, CBA 0.20%, Westpac 0.20% – ANZ to follow..
Kudos to ING Direct for being the first bank to pass on the full cut. We feel there may be one further interest rate cut down the line but expect the RBA to wait and see what effect this most recent cut has as it works its way through the economy before it feels compelled to act further. Investment property cashflows are now looking very attractive with a combination of strong rental yields, tax benefits and low interest rates driving down net holding costs