Interest rates: to fix or not?
- Don’t rush to fix your rates – take the time to do your research
- No one can predict when interest rates will change, so make the decision based on your farm’s financial needs
- Don’t be pushed into a decision.
In this month’s note, we look at whether you should fix your interest rate or not. Like commodity prices, interest rates rise and fall depending on macroeconomic conditions – none are accurately predicted.
You can look for guidance, like the recent Australian Reserve Bank announcement explaining interest rates won’t be lifted until the inflation rate falls within its preferred range of between 2 to 4% – something they don’t expect until 2024.
Considering you can’t predict the unpredictable, you should also use these considerations when deciding if you’ll fix your interest rate or not.