As we say goodbye to the heat of summer, we can look forward to enjoying the cooler days ahead. Along with the drop in temperature, the RBA brought much relief to mortgage holders by cutting the cash rate by 25 basis points in February. The cash rate is now sitting at 4.10 per cent following the first rate reduction since November 2020.
Inflation remained steady in February at 2.5 per cent, with core inflation at 2.8 per cent. However, the RBA remains cautious and has not guaranteed further cash rate cuts in 2025. Some economists are predicting additional cuts this year, but time will tell.
While ongoing tensions persist between Russia and Ukraine, as well as in the Middle East, and with a looming trade war due to Trump’s proposed tariffs, the global economic outlook remains unpredictable.
US markets reacted to lower-than-expected consumer spending and continued geopolitical uncertainty, resulting in another month of volatility.
It has also been a turbulent period for the Australian share market, with the ASX 200 losing ground earlier in the month, bouncing back to reach an all-time high, only to start falling again, closing at its lowest point in two months.
A similar pattern has been seen with the Australian dollar, which climbed to a high of $0.64 USD in mid-February before losing momentum and now hovering around $0.63 USD.
If there’s something affecting your financial situation that you’d like to discuss, please don’t hesitate to reach out to our team.
