The RBA Governor has said Australians shouldn’t expect interest rates to rise anytime soon
Peter Overton: Good news today for those with mortgages as the Reserve Bank governor said Australians should not expect interest rates to rise anytime soon.
His view was reinforced by the latest inflation figures, which came in lower than expected.
Ross Greenwood: The Reserve Bank governor, in a landmark speech, said increases in international interest rates do not mean rates are rising here.
Phillip Lowe: We don’t need to move in lock-step…
Ross: The dollar fell on that, and also with the latest numbers that show prices growing more slowly than forecast – it obviously takes a lot of pressure off the Reserve Bank.
Bill Evans: This idea that they’d be raising interest rates that’s certainly not been my view, either this year or next year.
Ross: Average prices grew just 0.2 percent in the quarter.
Annual inflation is 1.9 percent, below the Reserve Bank’s preferred range.
Bill: The low inflation story is definitely going to remain a factor for us.
Ross: The biggest rises are for medical and hospital services, new homes, and tobacco.
The biggest falls were for holiday accommodation and petrol.
Kavanagh Balloons knows all about inflation – it’s Australia’s only local hot air balloon manufacturer.
Sean Kavanagh: We’ve got, you know, high cost in materials like stainless steel and the fabrics and the balloons.
Ross: But business, right now, is good – maybe it’s a sign for the economy.
Phil Kavanagh: If the advertisers weren’t confident, and the tourism operators weren’t confident, then we wouldn’t be getting a business.
Ross: So this is what the government would prefer not to have – prices spiraling out of control, inflation taking off …
Instead it would really prefer prices to be more subdued.
At the moment, though, they’re a little too cool – so a little bit of inflation is not a bad thing.
That’s why official interest rates remain at all-time record lows and seem likely to stay there for some time
Ross Greenwood; Nine News