While there is talk that the Reserve Bank of Australia (RBA) may consider cutting interest rates today, Australia’s finance and mortgage brokers’ peak body says it’s unlikely.

Managing director of the Finance Brokers Association of Australia Peter White AM said while inflation has eased a little and many borrowers are struggling, the RBA must look at the long term.

“We all want to see rates come down and mortgage holders desperately need it, but the last thing we want is for the RBA to act too soon and then have to readjust and increase them again.

“Consumers need stability at this time, not volatility.

Mr White said the RBA should learn from their past mistakes and know the dangers of sending the wrong message.

“Not long before the very first rate rise the RBA was telling borrowers that there wouldn’t be a rise for years, and that gave people a false sense of security, resulting in a lack of awareness and preparation,” he said.

I’d imagine if they act suddenly to lower the rate now, it will be read by many that rates are on the way down, and they will act accordingly when this may not be the case.

He said that it is more likely rates would start to turn around towards the second half of the year when “hopefully they will continue to decrease and provide borrowers with the genuine help they need.”