Official Cash Rate Cut Again to 3.5%
Posted by Lee Suckling on January 29th, 2009
The OCR, Official Cash Rate, has been cut for the second time in two months by another 150 base points, taking it from 5% to 3.5%.
Reserve Bank Governor Allan Bollard announced the cut this morning, which is the lowest ever since the OCR was introduced in 1999 at 4.5%.
Financial experts predict that it could drop again in coming months a further 100 points, bringing it down to 2.5%.
With interest rates now lower than ever, real estate is becoming more and more affordable, with banks already lowering their mortgage rates in anticipation of the cut. Conversely, the OCR cut is bad news for those with money in the bank who will now earn less interest on their savings.
