An increase in buyer confidence is anticipated following the Reserve Bank of Australia’s recent interest rate cut.
The RBA announced a rate cut on Tuesday, February 18, reducing the official cash rate rate by 0.2 per cent, bringing it down to 4.1 per cent – the first cut since November 2020.
The cut has been hailed as a financial relief for homebuyers and has sparked a glimmer of hope for local businesses regarding an increase in consumer confidence.
Sunbury and Gisborne IGA operations manager Jay Morgan welcomed the news but said more needs to be done before people can truly enjoy shopping.
“More work will need to be done for people to be able to pay their home loans. Once they can do that, then we will see more people truly enjoying their shopping,” he said
Mr Morgan said the high interest rates in the past have significantly impacted shopping patterns, with consumers making fewer big purchases.
“Interest rate decision time always leaves us uncertain because of what we’ve had to go through as businesses in the last few years,” he said.
“People are now shopping four or five times a week as a norm with smaller purchases, and we’re seeing that they’re shopping at multiple retailers where they can get the best price and value for money,” he said.
Sunbury home and business owner Adhishwar Ghose said the rate cut will help him more so as a mortgager.
“In terms of the mortgage … it would probably be more of [a] help – it would definitely leave more money in the bank account at the end of the month,” Mr Ghose said.
He said he has needed to moderate spending in the past two or three years due to cost of living pressures, with the rate cut a relief in this regard.
“Now that there’s less of a mortgage payment we’ve just got more money to spend on other things,” he said.
