Low cash rate setting remains major tailwind for housing values
At todays’ meeting, the RBA maintained the official cash rate target at 0.1%. The decision comes off the back of subdued inflation figures for the March 2021 quarter. Annual growth in CPI was 1.1%, below the 2-3% target band needed to tighten labour market conditions and drive wages growth. Despite a swift recovery trend in labour market conditions across Australia through the December quarter, wages growth remained low at 1.4% over the 2020 calendar year. These inflation and wages outcomes reinforce the need for the low cash rate target; likely for years to come.