We are regularly asked by clients to comment about the state of interest rates and whether it is a good time to fix. As bankers we are more immersed in this than most however our crystal ball isn’t any better than anyone elses. That said, there are a few signs that have us thinking at the moment:
1) The recent employment stats show that Unemployment has dropped recently to 6.1%
2) The AUD seems to have stabilised and even come back slightly, back over 78 cents
3) The long term interest swap rates seem to be creeping back up. The 2 year rate was below 2% a week or two ago and yesterday it was 2.07% and this morning it was 2.09%. This is still less than the 90 day rate of 2.25% but the trend is upward.
Wouldn’t it be nice if Australia started to smile again!