Unemployment rise forces Reserve Bank of Australia's first cash rate movement in more than two years
Quick summary The official cash rate dropped to 1.25 as: · Consumer price inflation hovers around 1.2%; · The Australian dollar fell to 69.12c; · Unemployment increased to 5.2%; · Housing price declines stabilise; and · Home lending continues to cool. Unemployment Rise Forces Rate Drop The Coalition winning the Australian federal election not only came as a surprise, but it also meant that Australian’s dodged unwanted negative gearing changes. A move that many financial and property experts have said would have a profound impact on housing investment. Given this unexpected result, consumer confidence has improved. But despite this unemployment rates rose, forcing the Reserve Bank to drop the official cash rate. Economists say that this may be the first of many cuts to come. If unemployment and inflation continue to stall, then a further rate cut, possibly two may occur over the