Will Interest Rates go down in 2024?
As we set foot into 2024, homeowners and aspiring property buyers around Fremantle and Perth are grappling with a pressing question: Are interest rates bound to keep rising, or is there a glimmer of optimism on the horizon?
With the Reserve Bank of Australia (RBA) shifting its policy from a prolonged period of rate cuts to a series of hikes from April 2022 to October 2023, the financial landscape is in flux. This blog delves into the intricacies of the interest rate forecast for 2024 and the factors shaping it.
Factors Impacting Interest Rates in 2024
Understanding the factors influencing interest rates can help Perth residents make informed financial decisions. Here are some key factors to consider:
Inflation has been on the rise, reaching levels not seen in decades. To combat inflation, the higher interest rates can discourage spending and borrowing, theoretically, can slow down economic growth and help control inflation.
Economic growth is expected to slow in 2023, with the looming risk of a recession. Should a recession occur, the RBA may reduce interest rates to stimulate economic activity, resulting in lower interest rates in 2024.
Global Economic Conditions
The ongoing conflicts around the world have introduced additional volatility to inflation, potentially driving prices of oil and other factors.
The global economy is still grappling with the disruptions brought about by the ongoing COVID-19 pandemic and its ramifications on global supply chains. These uncertainties make the outlook unpredictable.
Predictions from the Big Four Banks
The significant players in Australian banking—Commonwealth Bank of Australia (CBA), Westpac, National Australia Bank (NAB), and Australia and New Zealand Banking Group (ANZ)—have voiced their predictions concerning the cash rate in the upcoming years. Here’s a condensed summary of their forecasts:
CBA: dropping by December 2024
Westpac: dropping by August 2025
NAB: dropping by February 2025
ANZ: dropping by May 2025
These projections provide a general sense of the direction of interest rates, the big banks are subject to change these forecasts suddenly.
In the midst of an uncertain financial landscape, the predictions offered by the big four banks provide a glimmer of hope for homeowners and aspiring buyers in Fremantle and Perth.
At Loan Monster, we understand that the world of interest rates is filled with uncertainties, but rest assured, we’re here to guide you through it.
Whether you’re gearing up to purchase a new home or considering refinancing your current mortgage, our dedicated team is on standby to offer expert guidance tailored to your unique needs. Contact us today!