The Reserve Bank made the decision to continue to hold the cash rate at 1.5 per cent at its June meeting today, due to the inflation rate remaining within its target range of around 2 per cent and business conditions continuing to improve.
Overseas economic activity appears to be buoyant with demand for our commodities trending higher and forecasts positive for the rest of the year.
The RBA noted that an additional supply of apartments coming onto the market in the Eastern States is expected to provide downward pressure on price and rent growth.
The further tightening of controls on lending, designed to counter-act the dominance of housing debt over household incomes, appears to be having an effect on the market.
I see little movement in rates over the next few months but borrowers need to be aware of these tougher controls placed on lending, especially interest-only loans.
Now is a good time for borrowers to get a mid-year, health check on their loans to ensure they are well placed for the second half of the year.