National Australia Bank has joined the pack in pushing out the interest rate hike.
According to The Financial Review, The NAB economics team says that the interest rate rise from the Reserve Bank of Australia is now more likely to start in the second quarter of 2019 instead of the final quarter of 2018. There are a number of contributing factors for this including lack of wage growth, a less robust housing market, and unemployment (currently at 5.6%).
One we like to watch: Keep your eyes on the unemployment rate. When this drops to 5% or lower, more often than not, this may mean an interest rate rise.
Is this good news for investors? Yes, from the point of view of property holding costs but we must ensure we have our property buffers well entrenched for any rate rises in the future. The negative is money is still cheap and this encourages more investors into the market to steal our stock 😉 .
You can read the full Financial Review article here.
Cheers,
John Pidgeon
Director – SOLVERE