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RBA makes August 2024 cash rate call
In its last five meetings, the Reserve Bank has held the cash rate at 4.35 per cent. Has it now decided to make a move? Find out in this special announcement, brought to you by Legal Home Loans.
Jerome Doraisamy
After holding the cash rate at 4.35 per cent in the four meetings it has thus far held in 2024, the Reserve Bank of Australia has decided to hold the cash rate at 4.35 per cent.
“The central forecasts set out in the latest SMP are for inflation to return to the target range of 2–3 per cent late in 2025 and approach the midpoint in 2026. This represents a slightly slower return to target than forecast in May, based on estimates that the gap between aggregate demand and supply in the economy is larger than previously thought. In part, this reflects an increase in the forecast for domestic demand. But it also reflects a judgement that the economy’s capacity to meet that demand is somewhat weaker than previously thought, evidenced by the persistence of inflation and ongoing strength in the labour market,” it noted.
“There is substantial uncertainty around these forecasts. Revisions to consumption and the saving rate in the most recent National Accounts, high unit labour costs and the persistence of inflation – particularly in the services sector – suggest there are upside risks to inflation. Wages growth appears to have peaked but is still above the level that can be sustained given trend productivity growth.”
In conversation with Lawyers Weekly, Legal Home Loans general manager Aylin Unsal said that the RBA’s decision to hold the cash rate today was “good news”, providing stability for borrowers and aspiring home owners.
“Currently, the average interest rate for residential loans ranges from 6 per cent to 6.9 per cent, depending on the product, lender, and customer profile,” she noted.
“If you’ve been considering purchasing property, now is an ideal time to get your pre-approval organised,” Unsal advised.
“When the cash rate eventually drops and interest rates fall, demand is expected to rise and it will make buying more attractive by increasing affordability and borrowing power.”
“Buying sooner could be a savvy move to get ahead of potential price hikes and a surge in competition. Plus, you could benefit from a potential reduction in interest rates down the road,” she espoused.
Legal professionals can get ahead of the competition by leveraging exclusive benefits, Unsal continued, such as home loans with just a 10 per cent deposit and waived Lender’s Mortgage Insurance.
“These advantages make entering the property market more attainable and realistic for the cohort,” she stressed.
“It’s best to speak to a specialist broker for lawyers to gauge what’s available for you.”
Late last month, Legal Home Loans directors Cullen Haynes and Andrew Johnson appeared on The Lawyers Weekly Show to discuss what bankers won’t tell you about lending, and how best lawyers can take advantage.
Jerome Doraisamy
Jerome Doraisamy is the editor of Lawyers Weekly. A former lawyer, he has worked at Momentum Media as a journalist on Lawyers Weekly since February 2018, and has served as editor since March 2022. He is also the host of all five shows under The Lawyers Weekly Podcast Network, and has overseen the brand's audio medium growth from 4,000 downloads per month to over 60,000 downloads per month, making The Lawyers Weekly Show the most popular industry-specific podcast in Australia. Jerome is also the author of The Wellness Doctrines book series, an admitted solicitor in NSW, and a board director of Minds Count.
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