December Interest Rate and Australian Economy

The Reserve Bank continues to show its confidence in the Australian Economy by reduce 25 basis points to 3.0 per cent. 

Things appear to be recovering in America and whilst Europe still has some hurdles to overcome. There at least appears willingness for all parties to work towards a solution with some innovative ideas coming out. 

Spain is offering citizenship for foreign property buyers in an attempt to boost their moribund property market. 

Many other European economies are also looking at innovative ways of boosting their economies and at the same time attracting much needed foreign capital. Australia will continue to have the doomsayers. The latest doom-laden prediction is that the mining boom is over. 

In fact, whilst there has been a reduction in the prices for those commodities, and yes, there have been a small number of mine closures. The mining sector is in fact still a very vibrant contributor to the Australian economy. New mines are still opening. 

The Liquid Natural Gas projects are proceeding at a rapid pace. Property prices in those cities and towns directly affected by the mines are still at levels that are well above those of the capital cities in those states. 

This flies against history and it is anticipated, that property prices in those capital cites, especially Brisbane and Perth must move upward to regain their natural balance.