Reserve Bank Announcement - July 2017

Following their monthly meeting this morning, the Reserve Bank of Australia released it's decision to leave the cash rate unchanged at 1.5% for the month ahead.

This is the 11th consecutive month that the cash rate has been held at 1.5% since being cut from 1.75% in August 2016.

In releasing the cash rate decision the Governor of the Reserve Bank, Phillip Lowe, made the following comments:

  • The broad based pick up in the global economy is continuing;
  • The rise in commodity prices over the last year has boosted Australia's National income;
  • The Australian economy is expected to strengthen gradually, with the transition to lower levels of mining investment following the mining boom almost complete;
  • Consumption growth remains subdued, reflecting slow growth in real wages and high levels of household debt;
  • Employment growth has been stronger over recent months and the various forward looking indicators point to continued growth in employment over the period ahead;
  • Conditions in the housing market vary considerably around the country;
  • Rent increases are the slowest for two decades and growth in housing debt has outpaced the slow growth in household incomes; and,
  • The recent supervisory measures should help address the risks assosiated with high and rising levels of household indebtedness. Lenders have also announced increased in mortgage rates for interest-only and investor loans.

The board judged that holding the stance of monetary policy unchanged at this month's meeting would be consistent with sustainable growth in the economy and achieving the inflation target over time.

To read the full monetary policy decision released by the Reserve Bank this morning, please click here.

What does it all mean?

According to Tim Lawless, head of research at Core Logic, said that the Reserve Bank's decision came as no surprise amid falling unemployment , the housing market showing signs of slowing and inflation running at 1.9%. He said that "if wages growth and inflation remain subdued we can expect the cash rate to remain on hold over the short term."

Paul Marshall, CEO of, explained his belief that "the Reserve Bank needs more time to monitor the impact of APRA's changes to lending requirements before making decisions to move on rates."

Over the last month several lenders across the country have announced small cuts to variable rate mortgages for owner-occupiers and increases to interest-only and investment loan rates. With lenders making these announcements it is no suprise that more and more Australian's are asking the question whether or not they consider a fixed rate mortgage.

Arrange a Mortgage Review

It is important to regularly review your financial solutions to ensure that they continue to meet your needs as your personal circumstances and economic conditions change.

Whilst your current financial solution may have been the most suitable solution available to you at the time, there may now be a more suitable solution available to you that may enable you to:

  1. Switch to a more suitable product and/or interest rate;
  2. Switch to a product that offers access to additional features such as an offset account or redraw facility;
  3. Refinance to a more suitable lender;
  4. Secure a lower interest rate;
  5. Save money on your mortgage repayments; or,
  6. Access equity in your home.

iconic home loans offer a complimentary mortgage review service where a broker will meet with you to review your current financial solutions and then offer a comparison of any other available solutions that may better suit your current circumstances and needs.

To arrange a mortgage review appointment you can contact our head offices on 1300 663 943, contact us via our website or send us an email.

Thanks for reading guys, we will be back next month with another cash rate update.

iconic home loans


** All information provided here is general only and your personal circumstances have not been taken into account during its preparation. You should seek independent advice before making any decisions in relation to your personal finances. Finance/refinance availability is subject to applicant satisfying lenders approval criteria and all approvals are at the discretion of the lender.