The Reserve Bank of Australia has cut
the official cash rate by 0.25 per cent citing slowing economic growth,
declining commodity prices and the weakening Australian dollar.
The decision to reduce rates to a
record low 2.5 per cent on the cusp of an election follows weakening business
confidence, rising unemployment and fresh concerns over China’s economic
outlook.
The Australian Bureau of Statistics
revealed retail spending stalled in June after soft results in the previous two
months. The latest ABS Retail Trade figures show Australian retail turnover was
relatively unchanged (0.0 per cent) in June, seasonally adjusted, following a
rise of 0.2 per cent in May.
In the ACT, house prices are
retracting due to an oversupply of new units and many potential new homeowners
are waiting to see which way the September 7 poll falls first.
The Housing Industry Association has urged both sides of politics to focus their election policies on housing to promote a housing-led recovery in the Australian economy.
The Housing Industry Association has urged both sides of politics to focus their election policies on housing to promote a housing-led recovery in the Australian economy.
“Residential building is one of the
few sectors in a position to generate substantial economic activity in the wake
of the mining boom,” said HIA Managing Director Shane Goodwin.
“Australia is currently building
around 25,000 homes per year less than a decade ago, which is not only putting
the brakes on job creation in the sector, but placing upward pressure on
housing prices.”
A borrower with a $300,000 home loan
will save $46 a month if the banks pass on the full amount.
To view the RBA’s full statement visit http://www.rba.gov.au/media-releases/2013/mr-13-15.html
