Westpac forecasts higher interests rates: Borrowers warned to brace for higher repayments
Monthly repayments could soon cost borrowers a lot more cash if Westpac’s predictions for rate rises do come to fruit...
The Reserve Bank left the official cash rate on hold at 4.75 per cent for the fifth consecutive month when it met yesterday.
Loan Market Group chief operating officer Dean Rushton said the decision was a “sound move”.
He said there was no reason for the RBA to lift rates this month or any other month in 2011.
“The four rates rises they implemented in 2010 are still having an impact through much of the economy,” Mr Rushton said.
“The RBA should weigh less of the decision on what’s happening in the minefields of Western Australia and focus more on what’s happening to retailers out there.
“There have been some major business failures recently and if you walk through any suburban shopping centre or retail strip you will see shops that have closed down.
“Consumer sentiment remains soft and many elements of the economy, including the home finance market, continue to lag.
"The last thing they need now and in the foreseeable future is for interest rates to go up. Any rate increase would be a serious setback to consumer confidence which is quite fragile at the moment.”