Interest Rate Prediction – Westpac’s Bill Evans

Westpac’s interest rate forecaster Bill Evan has released a recent statement stating that there is less than a 50% chance of an interest rate increase by the end of 2019. This prediction has changed since 2017 when it was widely anticipated that rates would increase in early 2019.

Why the change?

The Sydney and Melbourne markets are coming off the boil which has served to give APRA a sign of relief and lift some lending restrictions. Wages growth has not been strong even though unemployment rates are dropping. On top of that, low inflation is also serving to keep rates in check as well.

This is all good news for property investors. With yields in the Brisbane still around 4.5% – 5%, if you are borrowing at 4.5% that makes for a very “easy to hold” investment.