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Time to lock in some interest rate risk

Market fixed rates have fallen by around 0.8% over the week. This pricing indicates to me that it may finally be time to take advantage of these extraordinary market moves and lock in some borrowing costs.

Businesses should focus on risk management rather than fine tuning interest rate forecasts. Leave that to the markets and the economists.  With ongoing decent prospects for China; our transition to a trade surplus nation, and our attractive fundamentals for offshore investors the medium term  outlook for the Australian dollar remains positive. Firms should be stress testing their businesses on the basis of the Australian dollar averaging above parity with the USD in the medium term.

In conclusion,  I am surprised that markets have moved so quickly to incorporate such large rate cuts.  Now I feel that the time is right to consider taking some risk off the table by fixing some borrowing costs at such attractive levels.