Relief in sight as RBA cuts interest rates
Tuesday October 7, 2008
Today the RBA cut interest rates by a full percentage, potentially allowing many borrowers to save money. Interest rates fell from 7% to 6% - the first time interest rates have fallen a full percentage since May 1992.
At this stage, it is uncertain if banks will pass on the full interest rate drop to variable rate borrowers. It has been indicated that there will be a small decrease, bringing relief to many. Such a large decrease is hoped to prompt banks to lower their interest rates.
Original speculation had the interest rates dropping by 50 basis points. This 100 basis point drop is a welcome respite to many. Many Australians have variable personal loans and home loans, so many are pleased with the drop in interest rates, even if the banks only pass on a fraction of this.
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