There could be a break in the interest rate increase on June 1st, after indications in the latest Reserve Bank of Australia minutes.
The Reserve Bank of Australia (RBA) has pointed towards an
interest rate rise break on June 1st.
This is according to the minutes of its May meeting, which have now been released, the Australian Associated Press reports.
And the organisation admitted that the latest increase at beginning of the month, when the official cash rate increased from 4.25 per cent to 4.5 per cent, was in order to bring the figures to their decade-long average level.
It said: "On balance, members judged it prudent to undertake some further monetary policy tightening at this meeting.
"They noted that, if lenders responded as expected to another rise in the cash rate, interest rates faced by most borrowers would then be at around average levels over the past decade."
And the RBA suggested that the rise in prices of services had played a part in the inflation increase and it maintained it would not "be much below the top of the target range".
Moreover, it stated a desire to keep inflation within a target band of two to three per cent on average.
After the latest rate rise some banks followed suit by upping levels on their
credit cards or savings accounts. The NAB hiked up the latter by 0.25 per cent per annum.
A selection of its home loan accounts were also subject to an increase but Lisa Gray, group executive of NAB Personal Banking noted that the organisation had recently seen a bigger climb in home loan customers than it had done in years.
In addition, the RBA also announced in its minutes that the European debt crisis – such as financial problems in Greece – could become worse and have an effect on the global economic recovery.
Although, it stated that the direct impact from Greece on Australia was "small".
By Emma North
