For the second month running, rates have increased by 25 basis points (.25%) (effective November 4), increasing from 3.25% to 3.5%.
Australia, whom somewhat circumvented the global financial crisis, was the first western country to raise interest rates in October, and has only been followed by Israel and Norway.
Should the RBA raise rates again in December, it will be the first time Australian rates have ever been increased in three consecutive months.
Some other forecasts and facts on the Australian economy:
– the economy is likely to expand faster than previously forecast, driven by rising consumer confidence and Chinese demand for iron ore and coal . The Chinese economy has proved far more resilient than expected.
– Citigroup Inc, Barclays Capital and National Australia Bank are forecasting that 2010 will become the first year that the Australian Dollar reaches parity with the US dollar. This would be a 10% increase on the current level.
– GDP will likely increase by 1.5% in the year to June 30, 2010 (having grown by one per cent in the first six months of 2009).
– Wayne Swan, the Australian Treasurer, forecasts unemployment to peak at 6.75 percent in the second quarter of next year.
– House prices have increased by 8.4% for the six months leading up to September 2009.
– The S&P/ASX 200 benchmark has increased more than 20 per cent this year.
Things are certainly looking up, but lets not forget how grim they were looking. We’re not out of the woods yet so caution is still important.
Read the statement given by the RBA Governor, Glenn Stevens HERE