The Reserve Bank of Australia (RBA) held record low cash rates at 1.50% for February 2018. Governor Phillip Lowe said, “the low level of interest rates is continuing to support the Australian economy” and the rate, which has not moved since August 2016, has helped gradual inflation stabilisation and allowed progress in reducing unemployment.
Having been several years since the last cash rate increase, Steve Mickenbecker, Executive of Financial Services at Canstar Group has indicated that the knock-on effect on savings rates will result in seeing savers struggle to find a savings rate over 3%. Of course, bonus rates are on offer but only if customers can satisfy criteria.
“Don’t see the Board raising the cash rate until the second half of 2019.”
Sarah Hunter, Head of Macroeconomics Oxford, Australia
According to RFi Group data, this news will be particularly disappointing for 34% of savings account holders who are identified as ‘rate chasing’ savers and consider interest rates highly important.
Savers looking for the best returns will likely have to wait some time as Oxford Economics’ Head of Macroeconomics Australia, Sarah Hunter, claims they “don’t see the Board raising the cash rate until the second half of 2019."