Positive economic signs and a federal government push for banks to relax lending standards for small business will give the Reserve Bank of Australia (RBA) a break from cutting official interest rates, according to leading mortgage aggregator Finsure Group.
Finsure Managing Director John Kolenda said with the cash rate reduced to a record low of 0.75 per cent, the RBA may have done enough for the time being to help boost consumer confidence despite disappointing September retail sales figures.
“Having confident consumers is a major contributor to an economic turnaround and the domestic economy is still showing signs of improvement,” Mr Kolenda said.
“It is good to see the government talking to the banks about the way they have been applying the responsible lending guidelines to small and medium-sized enterprises. By supporting more lending and our SMEs, we should see positive signs of further economic improvement.”
In this environment, Mr Kolenda said there was no real need for the RBA to do much more until they get a better view of the economy into the first quarter of next year.
“It will be good to see consumers break the shackles and start spending again in the lead up to Christmas,” he said.
“Hopefully the central bank’s rate reductions have helped give consumer confidence a boost.”
Mr Kolenda urged mortgage holders to regularly review their home loans to ensure they were getting the best possible deal.
“Mortgage holders should never be complacent about their home loan.
“While interest rates are at historic lows, lenders are willing to battle for your business. Contact a mortgage broker to make sure you are getting the best terms possible and, most importantly, save money.”