Category Archives: Reserve Bank of Australia

Desperate first home buyers are fuelling price ‘up-crash’ at lower end of market, experts say

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Biggest house price increases in February come in smaller capital cities as buyers undeterred by interest rate hikes

Hot competition for cheaper Australian homes has powered a relentless “up-crash” in prices despite rising interest rates, economists warn.

Desperate first home buyers have bid up the price of affordable properties as they face off against investors, who have borrowed big despite government warnings they could lose tax discounts and deductions.

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RBA holds official interest rate at 3.6% while warning of rising house prices and rents

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Reserve Bank’s decision to leave cash rate on hold was widely expected and major banks predict no interest rates cut until 2026

The Reserve Bank has left the official interest rate on hold, as it warned house prices and rents will rise in 2026 after a surprise rebound in inflation.

The RBA’s monetary policy board on Tuesday kept the cash rate at 3.6%, where it has sat since August. Economists and banks overwhelmingly expected no change.

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Australian property investors squeezing out first-time buyers as record borrowing and rate cuts drive purchases

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Pressure on first home buyers heightens as investors target lower-priced homes and more affordable regions

Property investors borrowed a record sum, nearly $130bn, to buy homes over the year to June, supported by interest rate cuts but squeezing out first-time buyers.

Banks made almost 200,000 new loans to landlords over the year, the most since 2022, while the number of new first-home mortgages slipped to 116,000.

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Australia’s borrowers may have to wait weeks for Reserve Bank’s rate cut to reduce their mortgage

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NAB said it would wait 13 days to pass on the 0.25% cut to borrowers, while Westpac announced it would wait 14 days

Mortgage rates will slide after the Reserve Bank announced a third interest rate cut of the year – but borrowers with some major banks may have to wait weeks for relief.

Lenders have lined up to reduce their rates by 0.25%, with 20 banks – including each of the big four – announcing on Tuesday that they will pass on the cuts but only two of them doing so immediately.

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Australian property bounce after Labor wins second term, early data shows

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More buyers enter the market as auction clearance rates rose to 70% in the week following the election, figures show

Australia’s housing market has surged in the immediate aftermath of Labor’s emphatic election victory, preliminary data shows, while analysts say an anticipated string of rate cuts may see the trend continue.

Auction clearance rates rose to 70% in the week following the election, according to preliminary Cotality data, from 60% in the middle of last month. An auction clearance rate of 70% or above typically indicates sellers are in control of the market.

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Adelaide becomes fifth Australian capital where median house value exceeds $1m

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Across Australia, home prices grew at slowest rate in two years and unit prices fell in March, Domain says

Million-dollar houses are now more common than homes costing less than seven figures in five of Australia’s capital cities.

Adelaide’s median house value passed $1m in March, even as unaffordable costs and high interest rates saw home prices grow at their slowest rate in two years and unit prices fall.

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Australia news live: NSW health system ‘catastrophically let down’ toddler’s family, minister admits

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Two-year-old waited in emergency department for three hours before suffering a cardiac arrest and dying. Follow today’s news headlines live

Victoria to offer contactless public transport tickets from next year

Victorians will be able to use their phones, bank cards or smartwatches to pay for public transport travel from “early next year in a staged approach”, according to reports.

Following a successful start of a ticketless bus trial in Wangaratta, the Allan Labor Government will begin switching on tap-and-go technology across Victoria’s public transport network from early next year in a staged approach – meaning some passengers will soon be able to use their bank cards, phones and smart watches to travel on full fare tickets.

The new ticketing system will continue to be underpinned by extensive technical testing and will be carefully rolled out starting with rail from the beginning early next year – allowing full fare passengers more ways to pay for their travel.

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RBA expected to give mortgage holders ‘breathing capacity’ on interest rates

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But business shouldn’t hold its breath for any immediate effect interest rate cuts might have on spending habits – which can take up to nine months

The Reserve Bank is expected to provide “breathing capacity” to households with mortgages by cutting the official cash rate for the first time since the early days of the Covid pandemic.

The market is pricing in a 90% chance of a 25 basis point decrease on Tuesday, according to the ASX’s rate indicator, although several economists have warned they expect the decision to be closer than the odds suggest.

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Inflation data isn’t all sunshine and rainbows for Labor – as Biden and Democrats will attest

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While a pre-election rate cut is widely seen as positive for incumbent governments, it doesn’t necessarily represent a path to victory in itself

The Reserve Bank of Australia is designed to be independent of government, but that does not mean its decisions do not have political consequences.

After Wednesday’s better-than-expected inflation reading, there is now broad consensus among economists that the RBA will cut interest rates next month.

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Australia’s underlying inflation rate falls to 3.2% to bolster case for RBA rate cut next month

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Consumer price index dropped to 2.4% in December quarter, according to ABS figures released on Wednesday

Australia’s underlying inflation rate has fallen to a three-year low of 3.2%, bolstering the case for a rate cut next month that would provide a dopamine hit to the government ahead of a cost-of-living election.

The Reserve Bank of Australia’s preferred inflation gauge, which strips out volatile price swings, fell to an annual 3.2% for the December quarter, down from 3.5%.

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Inflation figures to ‘make or break’ the case for an Australian pre-election February rate cut

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Release of December quarterly CPI may be the most politically consequential set of numbers in recent times

Inflation figures due out on Wednesday could “make or break” the case for a pre-election rate cut next month, according to economists, in one of the most politically consequential set of numbers of recent times.

The market is pricing in an 84% chance of a 25 basis-point rate cut when the Reserve Bank of Australia (RBA) meets mid-next month, although those odds will rise or fall based on the December quarterly consumer price index.

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Australia’s housing market ‘buckling’ under widening gap between income and home values, report finds

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Housing prices fell by 0.1% in December but dip likely to be ‘shallow and short-lived’, according to CoreLogic

Australia’s housing downturn is being driven by a widening gap between income, borrowing capacity and home values, but the dip is likely to be “shallow and short-lived”, a new report has found.

In December, Australia’s property market eased with home values falling 0.1% after a flat result in November and a gradual slowdown over last year, according to CoreLogic.

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Senator calls social media ban a ‘sham’ – as it happened

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Canavan says under-16 social media ban has caused new generation to become passionate about democracy

Nationals senator Matt Canavan was loudly outspoken against the under-16 social media ban bill and voted against it – but as we know, the bill ultimately passed.

It has been great seeing people learn how the parliament works. And with that in mind, note that the social media bill is not yet law. Tomorrow morning it heads back to the House of Representatives because there were amendments passed in the Senate tonight. It then has to go to the governor general. But both these steps are almost certain to happen.

Thanks again for all of your help and support. We got some amendments on digital ID so it was not for nothing and the fight continues.

As it currently stands, underlying inflation is still too high to be considering lowering the cash rate target in the near term.

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Australia politics live: Dutton calls Labor’s international student caps bill ‘a dog’s breakfast’; RBA fuels expectations for February interest rates cut

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First investment announced as part of National Reconstruction Fund

The science and industry minister, Ed Husic, was on ABC News Breakfast to discuss the government’s first investment via the National Reconstruction Fund – $40m to a Toowoomba mineral processing factory.

The difference in terms of what the [NRF] does is it provides loans, equity, and guarantees to firms that are [working across] seven priority areas to expand and grow their operations.

Given the sizes of the investments, it does take more time to be able to go through to shape up what the investment will look like, how big it’ll be, over what term, the rate of return – because the other important thing to stress to viewers is – this is not about handing out grants, and certainly not doing it on the basis of political colour-coded spreadsheets as we saw with the last government.

In fact, the social media users were less likely to have a negative attitude towards Jewish and Muslim people, irrespective of where they were on the political spectrum.

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Australia politics live: Albanese tells caucus Labor will campaign on ‘risk’ of Dutton; Miles returns as Queensland Labor leader

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‘We need to extend the average time people stay in our defence force,’ says Matt Keough

The defence personnel minister, Matt Keough, has also been talking about that retention and renumeration package for defence.

We need to extend the average time people stay in our defence force.

That does mean it had a vulnerability. We’re looking at moving to more of a mesh-type arrangement of satellites, which provides greater resilience, with a more up-to-date technology, and we’ll be able to deliver the technology faster as well.

We are very much confident that we can meet these targets and that’s because we have properly funded them and we have a plan to get there, which is about really improving the terms of service for those who work in our defence forces.

We’re increasing and expanding the bonuses for continuing on in the defence force. We’re continuing the original retention bonus after your initial service obligation for three years and beyond that. There will be another bonus for people who stay in the defence force after that. And that’s really targeting those who are in their seventh, eighth, ninth years of service, which gets to the middle ranks where we’ve got an issue. And we’re also going to grow the active reserves so there are more opportunities for people in the reserve to do full-time or part-time work in the defence force.

This original plan goes back seven or eight years and it was about having two or three satellites above Australia to deliver that capability. Since then, we have seen technologies develop which can shoot satellites out of the sky but we have also seen technologies develop where you have thousands of micro satellites in a more distributed way providing the same effect and we are seeing that with Starlink above Ukraine.

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Australia news live: QLD LNP leader says end of coal before 2030s ‘fanciful’; patients at Sydney GP given less-effective vaccines

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The LNP leader, David Crisafulli, appears to be walking away from a commitment to 75% emissions reduction by 2035. Follow today’s news live

Rowland questioned on gambling ad ban

Michelle Rowland was also asked why it has taken 16 months for the government – as yet – to make no decision on gambling ads. The communications minister said the government has “been working diligently in this space” but action “should have been taken on this some 10 years ago”.

We’re working very closely with the states and territories because the vast majority of recommendations in our late colleague Peta Murphy’s report go to issues that go across commonwealth and state jurisdictions.

We’re also working very closely to ensure that there are no unintended consequences here and it’s actually effective.

We have every anticipation that we will be able to respond comprehensively this year and that’s what we’re working towards as a government.

We will be taking advice on the appropriate form in which that can be done. Legislation is obviously an option because there is an interactive gambling act at the commonwealth level, which enables some of these approaches to be implemented.

There will be penalty for the platforms just as they are now in the Online Safety Act … These penalties will be drafted and, as I said, we’re currently reviewing the Online Safety Act because the penalties as they stand … the maximum penalties are less than $1 million for some offences.

They are being challenged but, at the same time, the industry does understand the need to comply here and, by and large, does comply with the rules under the Online Safety Act.

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Fixed and variable home loans fall ahead of expected cash rate cut by RBA

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Australia’s interest rate is forecast to fall from 4.35% to 3.6% by this time next year, prompting seven lenders to cut their rates this week

Lenders have started lowering their mortgage rates en masse influenced by expectations of future interest rate cuts by the Reserve Bank – moves that could tempt borrowers to restructure their home loans.

The downward drift in rates is especially prevalent in fixed loans, with seven lenders cutting their rates by an average of 0.3 percentage points over the past week, according to Canstar. Four lenders cut variable rates by smaller margins.

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Assange says he is free because he ‘pled guilty to journalism’ – as it happened

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National weather forecasts

Sticking with the weather, here’s a look at the forecasts across Australia’s capital cities today:

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Australia’s housing crisis may be starting to ease as home prices fall in four capital cities

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New data also shows auction figures softening while rent rises are at their slowest pace in years

Australia’s housing crisis may be starting to ease with dwelling price rises tapering off and rents increasing at their slowest pace in four years, data groups say.

Property values increased 0.4% in September, close to the 0.3% rise recorded for both the previous two months, CoreLogic reported. PropTrack’s housing index was basically flat, rising just 0.04% for the month.

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RBA warns two factors risk increasing number of Australians caught in mortgage struggle

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Vast majority of borrowers servicing their debts but arrears could grow if economy slows more than expected, bank says

The number of Australians in financial stress is “small” but will be “magnified” if the economy slows more than expected or interest rates linger higher for longer, the Reserve Bank has warned.

While overseas challenges – including a faltering Chinese economy – could also upset forecasts, Australia’s financial system continued “to display a high level of resilience”, the bank said in its semi-annual financial stability review.

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