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Another cash rate cut could be on its way

By Kevin Kelly

There could be even more incentive to buy real estate in Bunbury over the coming months, as one major property group predicts another cash rate cut could be on the horizon.

The Real Estate Institute of Australia (REIA) believes the latest consumer price index (CPI) data gives plenty of reason for the official cash rate to be lowered further. The all-time low rate of two per cent came into force back in May and has remained unchanged ever since.

REIA president Neville Sanders explained: "In the September quarter, the CPI rose by 0.5 per cent and an annual rate of 1.5 per cent.

"These figures are well below the Reserve Bank of Australia's (RBA) target zone of two to three per cent and should ease any pressure on the interest rate outlook."

Inflation now appears to be under control and with the housing market now starting to moderate, there's every chance that a period of stability could be on the cards. Coupled with a further reduced cash rate, there's plenty of reason to take a closer look at buying real estate in Bunbury.

At its 6 October meeting, the RBA considered a variety of economic data. National accounts for the three months to June showed that there had only been a slight rise in GDP following the impressive results seen during the March quarter.

Not only this, household income was believed to have grown at a rate slightly slower than consumption over the past year. This led to a fall in the household saving ratio.

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