Borrowers are expected to see further declines in mortgage interest rates as Australia is struggling to escape the economic disaster brought about by the new crown epidemic. The Reserve Bank of Australia (RBA) Deputy Governor Guy Debelle said that the central bank may ease monetary policy and further reduce the official cash rate to 0.1% from a historical low of 0.25%.
The official cash rate is the interest rate for unsecured overnight loans between banks. Experts say this will cause mortgage interest rates, which are already at historically low levels, to fall further-interest rates of some mortgage agencies have fallen below 2%. De Belle said that during the epidemic, the economic recovery was “not a rapid rebound, more a slow run-in” and was hindered by the long-term Victorian blockade. “The epidemic is having an impact, especially due to the Victorian lockdown, but the lack of demand during the economic downturn is also the reason.” He said, “Until households and businesses have confidence in their future demand and income, they will not be willing Consumption and investment.”
Paul Bloxham, chief economist at HSBC, said that if cash rates really fall further, “may see mortgage rates fall a little bit more.” “Mortgage interest rates are already very low, but the Reserve Bank has made it clear that they do not intend to lower the cash interest rate to a negative number.” He said, “The official interest rate is now as low as 0.25%, and there is not much room for maneuver. “
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