Empower Blog Consumer Sentiment

RBA Rates Decision – July 2010

Today the RBA announced to hold the cash rate for the month of July at 4.5 per cent.  It’s welcome news to all mortgage holders across the country, who have seen their mortgage interest costs on a variable home loan increase dramatically from the historic lows of 3 per cent in early 2009. Let’s take a look at a $300,000 variable, interest-o...

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RBA Rates Decision – June 2010

Today the RBA announced to hold the cash rate for the month of June. That’s after several recent increases that have, in the view of the RBA moved the cost of money back to historically midpoint levels. The next move on rates will be an interesting debate given the recent events of the Euro zone and the ripple effects this is having on the glo...

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SPECIAL – Fixed Rate Mortgage Report

HOW ARE FIXED RATES FUNDED? Refresher from my comment in our May 2009 newsletter on fixed rates: Funding Fixed Mortgages - Lenders tend to outsource funding on money markets, via other banks/lenders – swap rates, through government bonds or via fixed savings deposits of similar duration which they collect from their own retail deposits, lockin...

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RBA Rates Decision – February 2010

The RBA announced an increase in the cash rate from 3.75% to 4.00% today.  This is the fourth consecutive increase in rates (given the RBA doesn’t meet in January).  The cash rate has now moved up 1.00% from a low of 3.00% back in April last year. Most forecasters are expecting the cash rate to increase by another 0.75% by the end of the yea...

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2010 Economic Outlook

Australia has defied the rest of the developed world and is looking at its 19th consecutive year of positive economic growth. Most economists are predicting that the economy will continue to grow this year and will fare much better than other economies. Gross Domestic Production (GDP) will be boosted by the planned Government infrastructure spen...

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US Economy heading into the festive season and 2010

US consumer sentiment unexpectedly fell in November while the trade deficit widened by more than forecast in September, which appears to be in line with the Federal Reserve's view of a fragile economic recovery. Chicago Fed President Charles Evans said US monetary policy will remain "highly accommodative" for quite some time, and possibly beyo...

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‘Mixed Economic Messages – Is this a V Shaped Recovery or a Hidden W for equity markets

Economic forecasting is ‘Rocket Science’ which is my way of saying that the forecasters and experts don’t always get it right.  Take for example the latest forecasts below from three major banks, who all have access to the same data and most likely same resources, yet their cash rate forecast for the next 12 months are significantly differen...

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RBA Rates Decision – October 2009

The Reserve Bank has lifted interest rates by 0.25% from their historical 40 year lows, due to rebounding economic outlook and change in sentiment.  The RBA believes we are past the worst of the economic downturn, yet the historically low rates were originally implemented with the view that the economy and unemployment were going to get worse than...

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Property Prices on the Up – Investors coming back….

It appears in just a couple of months that sentiment and actual property prices have come full circle, from the gloom and doom being reported back in March / April of this year.  The logical reason for this is that the data that most analysts report, such as the Real Estate institutes in each state, is up to 2 to 3 months following the actual resu...

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