[Podcast] 3.7% Unemployment: Has Australia Kissed Rate Cuts Goodbye? Dr. Andrew Wilson Weighs In

Sometimes good news is bad news.

The good news about our unemployment figures and the number of new jobs created is, in some ways, bad news for those hoping for interest rates to drop.

So what does the latest data mean for interest rates?

How does the Reserve Bank even decide what to do with rates?

What are the factors involved in their decision-making process?

That's what Dr. Andrew Wilson, Chief Economist of My Housing Market, and I discussed today.

We chat about what's ahead for interest rates and why he's concerned that the Reserve Bank may not drop interest rates anytime soon.

Insights on interest rates and the property market with Dr. Andrew Wilson

Australia's unemployment rate dropped to 3.7% in February, which is great news on the job front.

However, this raises the question of how well those 13 interest rate rises worked to slow down the economy and kill inflation.

Many borrowers were hoping for some relief in interest rates sooner rather than later.

Before the February figures, there was talk of rate cuts by the middle of this year, but many economists were predicting cooling labour markets in response to the Reserve Bank's recent series of interest rate hikes, and they thought rates would start to come down.

However, the February figures paint a very different picture.

Not only did unemployment fall, but a significant number of new jobs were created, and this robust jobs market data has got many economists scrambling to revise their interest rate predictions.

Interestingly, not Dr. Andrew Wilson, because he was slightly more cautious about what's ahead.

The Reserve Bank left interest rates on hold over March.

• The labour market data is solid
• Retail sales are still high
• Inflation is lower, but still ahead of the target range for the Reserve Bank
  • There’s also the concern that higher fuel prices will reignite inflation in the short term
• The variables that the Reserve Bank has to look at when making interest rate decisions
  • Inflation
  • Oil costs
  • Housebuilding costs
  • Rental rates
  • Jobs numbers
  • Retail sales
  • House prices
  • Economic growth
• The correlation between oil prices and inflation
• The indirect impact that overseas migration has on the Reserve Bank’s decisions
  • A surge in migration creates a high demand for housing, pressuring the already tight supply and urban planning
    • It’s especially difficult to forecast the effects of migration if the number of migrants is underestimated

Mindest Moment - rewiring your mind for wealth

Most property investors will need to make personal changes to become more successful property investors.

Change is difficult because our minds are programmed to keep us safe, and that means staying in familiar zones where we feel secure.

However, sticking with the familiar doesn’t work when it comes to wealth creation.

Doing the same thing you’ve always done will get you the same results you’ve always had.

If you want to be richer, you’ll need to branch out.

That means you’ll need to change your limiting beliefs and reset your internal Wealth Operating System.

Thinking about fear, scarcity, and limitation just leads to more of the same, and that’s what holds many Australians back.

To achieve more, your mindset needs to change.

Thinking about prosperity, abundance, and success is what will enable you to attract those things.

Remember, your thoughts lead to your feelings, your feelings lead to your actions, and your actions determine your results.

If you want different results, you have to start with different thoughts.

Links and Resources:

Get the team at Metropole to help build your personal Strategic Property Plan Click here and have a chat with us

Get a bundle of eBooks and reports – www.PodcastBonus.com.au

Join Dr. Andrew Wilson and me at Wealth Retreat 2024 on the Gold Coast in April 2024 – click here to find out more

Some of our favourite quotes from the show:

“Those who own property are doing really well at the moment. Their properties are going up in value, rents are going up and some people don't even have a mortgage against those. So, it's going to be good news and bad news for people.”– Michael Yardney

“Underestimating the population growth seems to be a systemic policy failure that compounds the challenge for delivering sufficient housing.” – Michael Yardney

“First of all, we need to change the way we think about ourselves. We need to see ourselves as a wealthy person, as a wealth attractor, as a wealth creator.” – Michael Yardney

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