interest rates

What stocks do well with interest rate cuts?

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When interest rates are cut, certain types of stocks tend to perform well. Here are some examples: Rate-sensitive sectors    Real Estate: Lower interest rates reduce the cost of borrowing for real estate companies, making it cheaper for them to finance new projects or refinance existing debt. This can lead to increased investment in real estate, driving up property prices and boosting the stocks of real estate investment trusts (REITs) and property developers.     Utilities: Utilities typically carry a …

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What factors does the RBA use to evaluate interest rates?

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There is always a debate in the market about what the next move in the cash rate would be. So what are the factors that the Reserve Bank of Australia (RBA) evaluates when determining interest rate rises or cuts? Inflation Inflation is the rising price of goods and services. When inflation occurs, the purchasing power of the consumer is diminished as the cost of living has increased. The RBA monitors inflation and will take into account inflation figures when deciding …

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What do bond yields indicate about interest rates?

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Bond yields are closely followed by investors as these affect interest rates. In this article we discuss what the relationship is between bond yields and interest rates and how it affects the share market. What are bonds? A bond is a loan taken out by a company or a government when they want to raise money. Purchases of bonds are essentially giving the issuer a loan and the issuers agree to pay back the face value at a specific date. …

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7 Factors the RBA Uses to Evaluate Interest Rates

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The current cash rate of 1.5 per cent is the lowest we have had in Australia. The Reserve Bank of Australia (RBA) has had rates on hold at 1.5 per cent since 3 August 2016. There is always a debate in the market about whether the next move in interest rates sees the rate head higher or lower, and in what time frame. So what are the factors that the RBA evaluates when determining interest rate rises or cuts? RBA …

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