The Reserve Bank of Australia left the cash rate unchanged at a record low of 1 percent during its September meeting, as widely expected. Policymakers said that it is reasonable to expect that an extended period of low interest rates will be required to make progress in reducing unemployment and achieve progress towards the inflation target. The Committee added that they will continue to monitor the effects of the two consecutive rate cuts in June and July and developments in the labour market. Interest Rate in Australia averaged 4.37 percent from 1990 until 2019, reaching an all time high of 17.50 percent in January of 1990 and a record low of 1 percent in July of 2019.

Interest Rate in Australia is expected to be 1.00 percent by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate Interest Rate in Australia to stand at 0.50 in 12 months time. In the long-term, the Australia Interest Rate is projected to trend around 1.00 percent in 2020, according to our econometric models.

Australia Interest Rate
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Calendar GMT Actual Previous Consensus TEForecast
2019-06-04 04:30 AM RBA Interest Rate Decision 1.25% 1.5% 1.25% 1.25%
2019-07-02 04:30 AM RBA Interest Rate Decision 1.0% 1.25% 1% 1%
2019-08-06 04:30 AM RBA Interest Rate Decision 1% 1% 1% 1%
2019-09-03 04:30 AM RBA Interest Rate Decision 1% 1% 1% 1%
2019-09-24 09:55 AM RBA Gov Lowe Speech
2019-10-01 04:30 AM RBA Interest Rate Decision 1% 1%
2019-10-11 12:30 AM RBA Financial Stability Review



Australia Holds Cash Rate Steady at 1%

The Reserve Bank of Australia left the cash rate unchanged at a record low of 1 percent during its September meeting, as widely expected. Policymakers said that it is reasonable to expect that an extended period of low interest rates will be required to make progress in reducing unemployment and achieve progress towards the inflation target. The Committee added that they will continue to monitor the effects of the two consecutive rate cuts in June and July and developments in the labour market.

Excerpt from the statement by Governor Lowe: 

The outlook for the global economy remains reasonable, although the risks are tilted to the downside. The trade and technology disputes are affecting international trade flows and investment as businesses scale back spending plans due to the increased uncertainty. At the same time, in most advanced economies, unemployment rates are low and wages growth has picked up, although inflation remains low. In China, the authorities have taken further steps to support the economy, while continuing to address risks in the financial system.

Global financial conditions remain accommodative. The persistent downside risks to the global economy combined with subdued inflation have led a number of central banks to reduce interest rates this year and further monetary easing is widely expected. Long-term government bond yields have declined and are at record lows in many countries, including Australia. Borrowing rates for both businesses and households are also at historically low levels. The Australian dollar is at its lowest level of recent times.

Economic growth in Australia over the first half of this year has been lower than earlier expected, with household consumption weighed down by a protracted period of low income growth and declining housing prices and turnover. Looking forward, growth in Australia is expected to strengthen gradually to be around trend over the next couple of years. The outlook is being supported by the low level of interest rates, recent tax cuts, ongoing spending on infrastructure, signs of stabilisation in some established housing markets and a brighter outlook for the resources sector. The main domestic uncertainty continues to be the outlook for consumption, although a pick-up in growth in household disposable income and a stabilisation of the housing market are expected to support spending.

Employment has grown strongly over recent years and labour force participation is at a record high. The unemployment rate has, however, remained steady at 5.2 percent over recent months. Wages growth remains subdued and there is little upward pressure at present, with strong labour demand being met by more supply. Caps on wages growth are also affecting public-sector pay outcomes across the country. A further gradual lift in wages growth would be a welcome development. Taken together, recent labour market outcomes suggest that the Australian economy can sustain lower rates of unemployment and underemployment.

Inflation pressures remain subdued and this is likely to be the case for some time yet. In both headline and underlying terms, inflation is expected to be a little under 2 percent over 2020 and a little above 2 percent over 2021.

There are further signs of a turnaround in established housing markets, especially in Sydney and Melbourne. In contrast, new dwelling activity has weakened. Growth in housing credit remains low. Demand for credit by investors continues to be subdued and credit conditions, especially for small and medium-sized businesses, remain tight. Mortgage rates are at record lows and there is strong competition for borrowers of high credit quality.

It is reasonable to expect that an extended period of low interest rates will be required in Australia to make progress in reducing unemployment and achieve more assured progress towards the inflation target. 


RBA l Rida Husna | rida@tradingeconomics.com
9/3/2019 9:56:16 AM



Australia Money Last Previous Highest Lowest Unit
Interest Rate 1.00 1.00 17.50 1.00 percent [+]
Money Supply M0 113.75 113.13 114.54 4.09 AUD Billion [+]
Money Supply M1 1014.60 360.21 1014.60 8.25 AUD Billion [+]
Interbank Rate 1.10 1.10 18.18 1.10 percent [+]
Money Supply M3 2128.07 2157.45 2157.45 10.19 AUD Billion [+]
Foreign Exchange Reserves 72210.00 65280.00 88457.00 1126.00 AUD Million [+]
Banks Balance Sheet 4483.06 4404.79 4483.06 322.97 AUD Billion [+]
Central Bank Balance Sheet 169138.00 175379.00 202663.00 30418.00 AUD Million [+]
Loans to Private Sector 950.11 962.36 962.36 20.21 AUD Billion [+]
Deposit Interest Rate 1.45 1.65 17.25 1.45 percent [+]
Private Debt to GDP 205.30 205.30 209.60 120.50 percent [+]


Australia Interest Rate

In Australia, interest rates decisions are taken by the Reserve Bank of Australia's Board. The official interest rate is the cash rate. The cash rate is the rate charged on overnight loans between financial intermediaries, is determined in the money market as a result of the interaction of demand for and supply of overnight funds. This page provides - Australia Interest Rate - actual values, historical data, forecast, chart, statistics, economic calendar and news. Australia Interest Rate - actual data, historical chart and calendar of releases - was last updated on September of 2019.

Actual Previous Highest Lowest Dates Unit Frequency
1.00 1.00 17.50 1.00 1990 - 2019 percent Daily




Country Last Previous
Argentina 82.79 Sep/19
Turkey 16.50 Sep/19
Mexico 8.00 Aug/19
Russia 7.00 Sep/19
South Africa 6.50 Sep/19
Brazil 5.50 Sep/19
India 5.40 Aug/19
Indonesia 5.25 Sep/19
China 4.20 Sep/19
Saudi Arabia 2.50 Sep/19
United States 2.00 Sep/19
Canada 1.75 Sep/19
Singapore 1.74 Aug/19
South Korea 1.50 Aug/19
Australia 1.00 Sep/19
United Kingdom 0.75 Sep/19
Euro Area 0.00 Sep/19
France 0.00 Sep/19
Germany 0.00 Sep/19
Italy 0.00 Sep/19
Netherlands 0.00 Sep/19
Spain 0.00 Sep/19
Japan -0.10 Sep/19
Switzerland -0.75 Sep/19


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