• The Reserve Bank of Australia (RBA) is in a bind. Meagre growth, lacklustre jobs figures and almost non-existent demand cornered it into cutting the official cash rate by 25 basis points to 2.25% – a new record low. But with steaming residential property markets in Sydney and Melbourne, many are asking whether this will simply fuel the fire of further property speculation.


China: It All Depends on You

  • The graph below captures the quandary facing the RBA. Commodity prices have taken a nose dive over the past year. Although there has been recent spikes in the price of benchmark iron ore (which accounts for over one fifth of Australian exports) this is not expected to hold and ANZ is tipping the average price per tonne to rest at $US58 for 2015. Which is unwelcome though not unexpected news for the small and medium sized producers already travelling in or near the red.


<p> </p>
<li>This slump can be explained by easing demand in the Chinese residential property and manufacturing markets. As the graphs below shows, all indicators for these markets have been on trend decline, and are expected to keep heading south.</li>
<p> </p>
<p><img decoding=This update does not constitute financial advice and should not be relied upon as such. It is intended only to provide a summary and general overview on matters of interest and it is not intended to be comprehensive. You should seek professional advice before acting or relying on any of the content.


Back to Insights and News

Related articles

All insights

1.5 million borrowers face mortgage stress

After a year of aggressive interest rate hikes, many mortgage holders are feeling the pressure. New research from Roy Morgan shows that in the three months to July 2023, 1.5 million Australians – or 29.2% of all mortgage holders – were at risk of mortgage stress. The latest figure breaks the previous record of 1.46 million
Read More

Housing market springs back to life

Australia’s housing market has long been a significant barometer of the country’s economic health. It has faced numerous challenges in recent years, including the effects of the global COVID-19 pandemic and a price downturn in 2022. However, the most recent data collected by Domain suggests the market is quickly regaining its footing. During the three
Read More

Markets brace for uncertainty as interest rates bite

Markets brace for uncertainty as interest rates bite The June cash rate decision has dashed hopes of rate hikes coming to an end. While the increase in interest rates has affected mortgage holders across Australia, certain regions will be hit harder due to high numbers of indebted households. According to CoreLogic’s analysis of the 2021
Read More