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REIA to RBA: cut rates ! Published Jan 28, 2015

REIA to RBA - cut rates

With inflation under control and a slow down in housing finance, the RBA Board should consider a rate cut.

The Real Estate Institute of Australia has called on the Reserve Bank of Australia to cut current interest rate levels following the release of the latest Consumer Price
Index figures. The December 2014 quarter CPI figures show that the RBA’s underlying trend series measures of inflation continue to be well within its target zone, which should translate into good news for home owners.

“In the December quarter, the CPI rose by 0.2% and an annual rate of 1.7%,” said REIA President Neville Sanders. “These figures are below the RBA’s target zone of 2-3% and should not put pressure on the inflation outlook. The annual changes for the analytical series of trimmed mean and for the weighted median were 2.2% and 2.3% respectively and compare to the changes for the twelve months to the September quarter 2014 of 2.4% for the trimmed mean and 2.3% for the weighted median.”
The housing group increased by 0.5% for the December quarter which was the same as the September quarter and an annual rate of increase of 2.4%. The main increase in the December quarter for the housing group was for new dwelling purchases, which increased by 1.1%. Rents increased by 0.5% for the quarter and 2.4% for the year.

“With inflation under control combined with a slow down in housing finance, it’s appropriate that the RBA Board seriously considers a cut in interest rates at their meeting next week,” said Sanders.

Source: The Real Estate Conversation – Jan 28, 2015

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