At its meeting today, the Board decided to leave the cash rate unchanged at 1.50 per cent.
The Reserve Bank Board meets on the first Tuesday of each month, which in November always coincides with Australia’s greatest horse race, the Melbourne Cup.
If you’re a betting person you would have been on a pretty sure bet if you predicted the RBA to keep the Cash Rate on hold at 1.50%, for yet another month. This now makes 15 consecutive months the RBA has kept rates on hold, with the last movement downwards by 0.25% in August 2016.
In fact, the November meeting has a higher tendency for the Cash Rate decision to be one of no movement, neither up nor down. You have to go back as far as November 2011 to find the last movement, which in that year was a movement down by 0.25%.
Having said that, in years past November has also been a month where the RBA has done some of the biggest single movements in the Cash Rate. In November 2008, they moved the Cash rate down by 0.75% in response to the market pressures of the GFC and in November 1991 the rate was dropped by a whopping 1.00%, again in response to recessionary times.
There is wide consensus that the Cash Rate will remain stable until well into late 2018, so other than Lenders tinkering around the edges with their home loan deals and in the absence of further regulatory intervention by APRA we should see home loan interest rates remain at very low and competitive levels for some time yet.