RBA July 2015 Cash rate decision – What’s happening in Greece and will it affect Australia?

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The RBA has just released their July 2015 Cash Rate. Find out if they kept the base rate on hold or if they decided to drop it even further?

Video transcript:

Today the Governor and the Board met and kept the cash rate at 2%. We saw changes in February and also in May of this year and now again, the Governor and the Board is basically just waiting to see what happens.

The biggest news story at the moment is obviously the Greece story and they have default on their loan. In last weekend they have had their referendum which allowed them to vote “No” which they did. So this is an interesting time for what’s happening in Greece and what’s happening to the European Union and obviously the Euro. The Euro is really important for countries like Germany, France and the bigger countries who can actually trade-off the smaller economies because it brings the Euro value down which makes their export so important in terms of their general GDP and economic activity. Let’s get back to Greece. What does it mean for them? Well, in the grand scheme of things, Greece as an economy is only around 2 billion dollars which putting it into context is only around half of New South Wales GDP. So in terms of global they are extremely small. But the big word that you are going to hear soon is this word about contagion. What does that mean for the European Union?

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