RBA Rates Cut - What You'll Save
The Reserve Bank has cut the cash rate to a new record low of two per cent, saying that falling commodity prices, weak business investment and subdued government spending are dragging on the economy.
"The economy is therefore likely to be operating with a degree of spare capacity for some time yet," RBA governor Glenn Stevens said.
He added that although the Australian dollar has dropped noticeably against the US dollar it will have to fall further because of the large declines in commodity prices.
There were no indications in the RBA's short statement that it is looking to cut the cash rate further.
WHAT YOU'LL SAVE IF BANKS FOLLOW THE RBA:
Repayments on a $300,000 mortgage will drop by $45 a month on average if retail banks fully pass on Tuesday's 25-basis-point cut in the cash rate by the Reserve Bank.
If your mortgage is (size, new monthly repayments, reduction):
* $100,000 - $608.13 - $14.95
* $150,000 - $912.19 - $22.42
* $200,000 - $1216.26 - $29.90
* $250,000 - $1520.32 - $37.37
* $300,000 - $1824.39 - $44.84
* $350,000 - $2128.45 - $52.32
* $400,000 - $2432.52 - $59.79
* $450,000 - $2736.58 - $67.26
* $500,000 - $3040.65 - $74.74
This assumes 25-year standard variable rate loan at an average new interest rate of 5.4 per cent.