According to statistics, the Australian economy is doing well and, depending on economic figures released shortly, interest rates look like rising soon. But there are still many households that can’t afford to make higher debt repayments.
The good news is that Australia is weathering the global downturn really well. It is the only major developed country to record economic growth last financial year. Aussie households and companies are still spending and expanding despite the financial crisis and recession in other countries.
Just when rates will rise again in this cycle is a hot topic of debate. Some forecasters have tipped as early as next month others don’t expect a move until next year. The interesting debate is however who will be first – the Reserve Bank or one of the large financial institutions.
RBA Governor Glenn Stevens
If things were improving and it wasn't just a rhetorical 'if'; Stevens clearly had major uncertainties "there will come a time" when the exceptional monetary stimulus in place would no longer be needed.
"It will then my emphasis be appropriate for the Board to do what it has done on past such occasions, namely to start adjusting interest rates back towards normal levels."
"The timing and pace of those adjustments, if and when they come, will be a matter of careful consideration, taking into account all the relevant factors, including what might be happening with market interest rates."
Most economists and forecasters now appear to think an interest rate rise is likely before Christmas. According to Herald Sun economic commentator Terry McCrann, it would take something dramatic for the RBA to lift rates as early as October.
But the longer it holds off, the more likely the individual banks will increase rates independently, he says.
"If they could be confident the RBA would hike in October or even November, they would wait – aiming to slip in, say, a 35-40 point hike on the back of an official 25-point move," McCrann says.
"But if the clock ticks by and there’s no official hike, who will be first?"
For nearly three decades, Terry McCrann has been a media commentator of distinction. He writes a daily column that is syndicated in the Herald-Sun, Sydney Telegraph-Mirror, Brisbane Courier Mail, Hobart Mercury and the Adelaide Advertiser. McCrann's reach is testament to his knowledge of the business sector and his ability to convey that knowledge to his readers. McCrann is also a regular columnist for The Australian and frequently appears on television and radio. Communicating is second nature to him.
Terry McCrann's critical analysis of business and economic issues and trends is high calibre. With his reputation, he commands a bigger audience than any other columnist in Australia. Well-known for his hard-hitting commentary, McCrann's expertise ranges across business, politics, economics and finance.
In a time of changing economic outlooks, Terry McCrann understands the forces that drive the economy. Will interest rates go up? Will the dollar fluctuate? Which companies are ripe for takeover? Terry McCrann's opinions are based on an expertise that lends credibility and reliability.
The ability to communicate is an essential part of a speaker's profile. Knowing the subject is just one part of successful communication. Terry McCrann's enduring influence in the media is testament to his communication skill. But he has the knowledge to go with it. Terry McCrann is a past winner of the Walkley Award for journalism, is a former Graham Perkin Journalist of the Year, and is a previous winner of the Melbourne Press Club's Golden Quill Award among many other awards and accolades.
Terry McCrann is a business speaker with few rivals. His experience and expertise guarantee his success.
For further insightful economic advice Terry McCrann can be engaged through Platinum Speakers and Entertainers for corporate events and conferences.
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