RBA Cash Rate down from 0.75 to 0.5% (March 2020)

non-core promise on 03/03/2020 - 14:38
Last edited 03/03/2020 - 14:43

Statement.

Another new record low. They blame the coronavirus.

The coronavirus has clouded the near-term outlook for the global economy and means that global growth in the first half of 2020 will be lower than earlier expected. Prior to the outbreak, there were signs that the slowdown in the global economy that started in 2018 was coming to an end. It is too early to tell how persistent the effects of the coronavirus will be and at what point the global economy will return to an improving path.

Once the banks pass this on, most saving accounts will probably drop below the inflation rate after taxes.

Financial

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Comments

  • Ghost47 on 03/03/2020 - 14:53
    +4

    Woohoo time to buy houses to boost the economy!

  • DingoBilly on 03/03/2020 - 14:54
    +3

    I'm going to put this link up as I found it pretty useful last time to know which banks are passing on what cuts:
    https://www.savings.com.au/home-loans/rba-rate-cut-march

    Might be time for those on mortgages to review, especially as some lenders have only been passing on 0.15-0.20 of the cuts of the last few cuts as well.

  • Donaldhump on 03/03/2020 - 15:35
    +12

    interest rate cut

    1.) every mortgage holder will store savings in bank
    2.) every saver will have less to spend and will thus spend less
    3.) house prices will inflate even more to the point of stupidty.

    inflation not stimulated will just stay the same
    economy will get worse.

    alternative (this is a rough idea and not perfect)

    **** the surplus, increase newstart, give low income earners $500 (< 30k a year), and give the rest some coin (income tested / staggered / cutoff) that they must spend on domestic travel, white goods, bulk clothes , education etc and if they cant provide receipts next tax year they must repay it back. rough idea, but current politicians are hopeless.

    • MarsTitan on 03/03/2020 - 15:46
      +1

      Agreed. "go hard, go early, go households"

    • jackofspade on 03/03/2020 - 16:26
      +5

      Agreed. The RBA is now effectively impotent.

      • Donaldhump on 03/03/2020 - 16:30
        +1

        its ok you get used to it

      • GG57 on 03/03/2020 - 16:43

        Impotent, but is limited in the actions it can take.
        The government is responsible for policies.

    • Bargain80 on 03/03/2020 - 17:22
      +1

      the biggest winner from rate change (up or down) is the banks.

  • askme69 on 03/03/2020 - 15:52

    The Government dropped the ball on house prices and education.

    House prices were going up, the GOV said great, the Punters are happy. Not looking at the mess it will create for future generations.

    Universities and Private schools were raking in International students and not pressuring the GOV for more money, great another winner. Look at the shit show that has turned out to be,

    The common denominator for the BOOM and STUDENTS also gives us a bio weapon.

  • Cluster on 03/03/2020 - 16:25
    +2

    I'm going into debt up to my eyeballs because interest rates will never rise from here. Good times!

    • Donaldhump on 03/03/2020 - 16:31
      +1

      may as well go buy a 2 million dollar mansion some where the mortgage is like 1200 a week, get a few mates and you can live like pablo escobar

      • GG57 on 03/03/2020 - 16:44

        $2m does not equal 'mansion'

        • Donaldhump on 03/03/2020 - 16:46
          +1

          does where i live

          i moved from Sydney long time ago.

          • GG57 on 03/03/2020 - 16:48

            @Donaldhump: Ok
            Your profile shows 'Point piper' location; I assumed THE Point Piper

            • Numlock on 03/03/2020 - 16:49

              @GG57: he lives near the pied piper

            • Donaldhump on 03/03/2020 - 16:49

              @GG57: i own a house there, its small, but don't live there any more. i moved to gold coast cheap as in the hinterland

  • Nutrino on 03/03/2020 - 17:10
    +1

    there is no better time in history to get a huge debt….

  • umoddbro on 03/03/2020 - 22:58

    Pensioners and young people saving for house deposit take another blow

  • monkeybusiness on 03/03/2020 - 23:40
    +1

    The RBA has dropped the ball for years.

    Interest rate cuts should be used for emergency stimulus not for the sake of political inaction to ensure that we have the world's longest economic run without a recession. Not to mention the Government is running contradictory fiscal policy so they can have their budget surplus.

    Should have bit the bullet years ago with a recession and keep our rates at around min 3% so that we can actually do have a buffer for emergencies like now. People are so highly indebted that they are most likely just going to use the money saved from mortgage interest to directly pay down debts or save up for the next investment property.

    Gotta love the Australian dream.

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