The Reserve Bank of Australia left the cash rate at a record low of 1.5 percent at its December meeting, as widely expected, extending its record period of policy inaction beyond two years, amid sluggishness in inflation and a slowdown in housing market. Interest Rate in Australia averaged 4.48 percent from 1990 until 2018, reaching an all time high of 17.50 percent in January of 1990 and a record low of 1.50 percent in August of 2016.

Interest Rate in Australia is expected to be 1.50 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 1.50 in 12 months time. In the long-term, the Australia Interest Rate is projected to trend around 2.00 percent in 2020, according to our econometric models.

Australia Interest Rate
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Calendar GMT Actual Previous Consensus TEForecast
2018-09-04 04:30 AM RBA Interest Rate Decision 1.5% 1.5% 1.5% 1.5%
2018-10-02 04:30 AM RBA Interest Rate Decision 1.5% 1.5% 1.5% 1.5%
2018-11-06 03:30 AM RBA Interest Rate Decision 1.5% 1.5% 1.5% 1.5%
2018-12-04 03:30 AM RBA Interest Rate Decision 1.5% 1.5% 1.5% 1.5%
2018-12-18 12:30 AM RBA Meeting Minutes
2019-02-05 03:30 AM RBA Interest Rate Decision 1.5%
2019-02-08 12:30 AM RBA Statement on Monetary Policy



Australia Holds Cash Rate at 1.5% in December



The Reserve Bank of Australia left the cash rate at a record low of 1.5 percent at its December meeting, as widely expected, extending its record period of policy inaction beyond two years, amid sluggishness in inflation and a slowdown in housing market.

Excerpt from the statement by the governor, Philip Lowe: 

Globally, inflation remains low, although it has increased due to the earlier lift in oil prices and faster wages growth. A further pick-up in core inflation is expected given the tight labour markets and, in the United States, the sizeable fiscal stimulus.

Financial conditions in the advanced economies remain expansionary but have tightened somewhat. Equity prices have declined and credit spreads have moved a little higher. There has also been a broad-based appreciation of the US dollar this year. In Australia, money-market interest rates have declined, after increasing earlier in the year. Standard variable mortgage rates are a little higher than a few months ago and the rates charged to new borrowers for housing are generally lower than for outstanding loans.

The Australian economy is performing well. The central scenario is for GDP growth to average around 3½ percent over this year and next, before slowing in 2020 due to slower growth in exports of resources. Business conditions are positive and non-mining business investment is expected to increase. Higher levels of public infrastructure investment are also supporting the economy, as is growth in resource exports. One continuing source of uncertainty is the outlook for household consumption. Growth in household income remains low, debt levels are high and some asset prices have declined. The drought has led to difficult conditions in parts of the farm sector.

Australia's terms of trade have increased over the past couple of years and have been stronger than earlier expected. This has helped boost national income. Most commodity prices have, however, declined recently, with oil prices falling significantly. The Australian dollar remains within the range that it has been in over the past two years on a trade-weighted basis.

The outlook for the labor market remains positive. The unemployment rate is 5 percent, the lowest in six years. With the economy expected to continue to grow above trend, a further reduction in the unemployment rate is likely. The vacancy rate is high and there are reports of skills shortages in some areas. The stronger labour market has led to some pick-up in wages growth, which is a welcome development. The improvement in the economy should see some further lift in wages growth over time, although this is still expected to be a gradual process.

Inflation remains low and stable. Over the past year, CPI inflation was 1.9 percent and in underlying terms inflation was 1¾ per cent. Inflation is expected to pick up over the next couple of years, with the pick-up likely to be gradual. The central scenario is for inflation to be 2¼ per cent in 2019 and a bit higher in the following year.

Conditions in the Sydney and Melbourne housing markets have continued to ease and nationwide measures of rent inflation remain low. Credit conditions for some borrowers are tighter than they have been for some time, with some lenders having a reduced appetite to lend. The demand for credit by investors in the housing market has slowed noticeably as the dynamics of the housing market have changed. Growth in credit extended to owner-occupiers has eased to an annualised pace of 5–6 per cent. Mortgage rates remain low, with competition strongest for borrowers of high credit quality.


RBA l Rida | rida@tradingeconomics.com
12/4/2018 6:43:33 AM



Australia Money Last Previous Highest Lowest Unit
Interest Rate 1.50 1.50 17.50 1.50 percent [+]
Money Supply M0 111.62 109.68 111.62 4.09 AUD Billion [+]
Money Supply M1 357.01 357.10 358.22 8.25 AUD Billion [+]
Interbank Rate 2.24 2.49 18.18 1.87 percent [+]
Money Supply M3 2100.71 2092.84 2100.71 10.19 AUD Billion [+]
Foreign Exchange Reserves 66029.00 64038.00 88457.00 1126.00 AUD Million [+]
Banks Balance Sheet 4278.05 4268.34 4278.05 322.96 AUD Billion [+]
Central Bank Balance Sheet 177782.00 169966.00 202663.00 30418.00 AUD Million [+]
Loans to Private Sector 948.09 944.03 948.09 20.21 AUD Billion [+]
Deposit Interest Rate 1.90 1.90 17.25 1.90 percent [+]
Private Debt to GDP 205.50 208.60 210.90 120.50 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 December of 2018.

Actual Previous Highest Lowest Dates Unit Frequency
1.50 1.50 17.50 1.50 1990 - 2018 percent Daily




Country Last Previous
Argentina 58.97 Dec/18
Turkey 24.00 Nov/18
Mexico 8.00 Nov/18
Russia 7.50 Nov/18
South Africa 6.75 Nov/18
Brazil 6.50 Dec/18
India 6.50 Dec/18
Indonesia 6.00 Nov/18
China 4.35 Nov/18
Saudi Arabia 2.75 Nov/18
United States 2.25 Nov/18
Singapore 1.97 Nov/18
Canada 1.75 Dec/18
South Korea 1.75 Nov/18
Australia 1.50 Dec/18
United Kingdom 0.75 Nov/18
Euro Area 0.00 Nov/18
France 0.00 Nov/18
Germany 0.00 Nov/18
Italy 0.00 Nov/18
Netherlands 0.00 Nov/18
Spain 0.00 Nov/18
Japan -0.10 Nov/18
Switzerland -0.75 Nov/18


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