Interest Rate Update (September 2017)

The following graph shows movements in both the 3 month and 3 year Bank Bill yield rates, for the period January 2006 to September 2017. These rates are wholesale rates which are net of any margin charged by financial institutions.

Currently the 3 month wholesale Bill rate is 1.73% pa and the 3 year wholesale Bill rate is 2.08% pa, a premium of 0.35% pa or 35 basis points for the longer term. The premium for the forward rate suggests that rates are more likely to rise than fall in the medium term.