We continue to see the low interest rate environment dominate the current economic cycle. This shows no signs of abating any time soon. There are some economists predicting the next RBA decision on movement of rates will see a further reduction – personally I’m not so sure.
I can see the current rate held for some months to come, well in to 2017…
The rise and rise of house prices has been ongoing, despite experts predicting its demise. It will be an interesting watch and observe what eventually happens in this area.
Whilst the RBA has lowered interest rates to the lowest point in history, the Banks/Financiers are certainly holding firm on their margins when pricing equipment deals. With equipment lending offering fixed rates for the term of the loan, the lenders are making a decent margin on these transactions.
In fact, we saw lower interest rates offered on Cars and Equipment 12-16 months ago than we are seeing now. Don’t get me wrong, the rates on offer are still low by historical standards but the lenders are definitely maintaining some ‘fat’ or margin in these deals.
What we are seeing is our lending panel show some enthusiasm for doing/approving deals again and the number of settled deals month on month has been very strong. Overall we are seeing a confidence return too small and medium size businesses with Government infrastructure projects increasing and work beginning to flow through the transport and machinery sectors.
