Interest Rate Update (April 2011)

The following graph shows movements in both the 3 month and 3 year Bank Bill yield rates, for the period January 2006 to April 2011.

These rates are wholesale rates which are net of any margin charged by financial institutions.

The gap between the short term and long term rate has closed, indicating that rates may stabilize in the short to medium term.

Currently the 3 month wholesale Bill rate is 4.92% pa and the 3 year wholesale Bill rate is 5.45% pa, a premium of only 0.53% pa for the longer term.  This compares with a premium of 1.07% pa at the same time last year.