We discussed the potential of it happening before but it’s finally happened. The Reserve Bank of Australia has cut interest rates from 1.75-percent to 1.5-percent.
In the statement from the RBA, governor Glen Stevens said, “Recent data suggest that overall growth is continuing at a moderate pace, despite a very large decline in business investment”. He continued “Other areas of domestic demand, as well as exports, have been expanding at a pace at or above trend. Labour market indicators continue to be somewhat mixed, but are consistent with a modest pace of expansion in employment in the near term.”
The RBA used the data showing inflation was at it’s lowest in 17 years and stated that it would probably stay low for a long time. The theory being that low-interest rates would help banks lend money which would help the economy. But are they thinking of you and how this will effect the over 60s of Australia?
How this is going to end up hurting the pensions of many Australia’s is yet to be determined but the outlook is grim.
Reserve Bank cuts interest rates by 25 basis points to a fresh record low of 1.5% https://t.co/JWbuxn6nia
— Michael Janda (@mikejanda) August 2, 2016