The four charts that prompted the RBA keep rates on hold in August

The four charts that prompted the RBA keep rates on hold in August
The four charts that prompted the RBA keep rates on hold in August

The RBA kept rates on hold at the August meeting, following back to back rate cuts to bring the official cash rate down to a record low one percent.

It had previously stood at a historic low 1.5% before the latest cuts. The rate hadn't been cut since August 2016 when it was brought down from 1.75%.

Today the RBA have released their chart pack, which highlights key factors in the Australian economy.

Property Observer takes a look at four key charts which will have been strong influencers in the decision to cut the official interest rate.

Consumer Price Inflation ticked up slightly

The four charts that prompted the RBA keep rates on hold in August

Australia's Consumer Price Index rose 0.6 percent over the June quarter, slightly higher than expectations. 

The CPI rose 1.6 per cent through the year to the June quarter 2019, after increasing 1.3 per cent through the year to the March quarter.

Westpac had been forecasting a 0.5% rise in the June quarter CPI, taking the annual pace to a 1.5% rise from 1.3%.

IFM economist Alex Joiner says the figures were a slight upside surprise, however it is inline with expectations on core measures. 

Household disposable income rose slightly, but it's not translating into increased consumption yet.

The four charts that prompted the RBA keep rates on hold in August

Disposable income has bucked its steady, ongoing decline after it nearly hit 0%. 

Consumption has carried on declining, but the RBA will be keen to see disposable income rise given the recent rate cuts.

Consumer sentiment continues to rise

The four charts that prompted the RBA keep rates on hold in August

Consumer sentiment continued its upward trend following the federal election outcome having dipped below the average index earlier in the year.

It is now equalling, and bettering, levels in boom time 2015 and 2016.

Housing prices starts to rebound.

The four charts that prompted the RBA keep rates on hold in August

House prices have started to stabilise after a long downward trend which saw them approach 10% declines.

Statistics from the ABS, APM, Residex and CoreLogic all show a turnaround.

To download the full chart pack in full, click here.

 

Tags: 
Interest Rates Rba Rate Decision

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