....the financials and property is an anouncement by Tuesday latest that there is going to be a special emergency meeting of the reserve bank!That would properly set the cat amongst the pidgeons!....When i originally spoke about bringing down interest rates,most on our learned forum took the side of the govenor against such a move...i now feel that we are behind the curve and should join the rest of the world and reduce interest further.Try as we may we cannot divorce ourselves from other nations as we asr dependent on trade with them to financially survive....Our interest rate is one of the highest for a partial developed nation.
I am not much of an economist, but if interest rates are lowered, will it really make much of a difference to the economy? Does it amount to a domestic market benefit only or will international investors perk up interest? If it is domestic market benefit only, how much difference can we as consumers really make in this type of market? I mean, if the issue here is that lack of credit is hampering growth, how will lowering interest rates combat this?
There are only two reasons why they'd reduce rates, and that's if they thought inflation would be within their target bounds relatively soon, or if Parliament changed their target. Most countries don't target inflation so we can't compare to them. The Resbank can't change that - they can only change once Parliament change the goal the Resbank has.
What would help us all is the lowering of food prices. I think some organisations are making big bucks off the population by way of exploitation in some way. Have no proof of any wrong doing, just my view on this. I might be very wrong.