FIXED INTEREST TERM DEPOSIT and FIXED RATES HOLD THEIR LOWS
Australia ’ s recovery from COVID continues to challenge fixed interest investors , and may continue to do so for 2 years .
The Reserve Bank of Australia ( RBA ) has just confirmed the historic low cash rate and commitment to hold it down to support borrowers , business , residential and government , all hoping reignite some lasting inflation , corporate ‘ pricing power ’ and personal wage increases . The RBA has signalled the same for bond markets seeking to also hold down government bond rates out to 10 years maturity . At the same time , the RBA continues to seek a stable , even falling Australian dollar .
Major banks have already raised fixed rate borrowing rates beyond 3 year maturities .
Continuing government and ‘ central bank ’ stimulus including in the May Federal budget and by President Biden in USA have boosted share markets and real estate prices .
Recognised Australian bank 6-month term deposits still average 0.30 %.
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