Game of Interest Rates

Even the most seasoned economic commentators were surprised with the RBA’s decision this month to reduce interest rates. The ninth consecutive drop since November 2011. There were very few who saw it coming, particularly in light of the lower Australian dollar.

The economic gurus might have been confused but deposit-holders, particularly those who rely on investments for their income, were feeling another emotion – anger. A 10% drop in the cash rate from 2.5% to 2.25% is significant and many might be wondering if it would be a better option to stuff their cash under their mattress. They might sleep better at night!

A change in interest rates has a broad effect across our country. This video,”Interest rates affect everyone differently”, explains how these differences are experienced by homeowners, investors, business owners and deposit holders and how each may benefit from a low interest rate environment