Interest Rate Update (September 2020)

The following graph shows movements in both the 6 month and 3 year Bank Bill yield rates, for the period January 2016 to date.

These rates are wholesale rates which are net of any margin charged by financial institutions. It is not uncommon for retail premiums for 3 year fixed rates, to be 0.30% pa or 30 basis points above the wholesale premium.

Currently the 6 month wholesale Bill rate is 0.15% pa and the 3 year wholesale Bill rate is 0.17% pa, a premium of 0.02% pa or 2 basis points for the longer term.  This very slight premium for the forward rate suggests that rates are likely to remain stable at current levels in the near future. No significant rise in rates can be expected until a vaccine for COVID-19 is developed and the global economy regains some confidence, stimulating greater consumption of goods and services.