RBA “Grinch” steals retiree Christmas

Retirees are in for a tough Christmas with the Reserve Bank taking official interest rates to their lowest level since the 2009 Global Financial Crisis.

The Reserve Bank on Tuesday cut the official cash rate from 3.25% to 3%, the fourth reduction in 2012.

“The cut comes as a blow to retirees who depend on their bank deposit returns for a small steady income,” says National Seniors chief executive Michael O’Neill.

“For many retirees readying to buy presents for the grandkids, the Reserve Bank will be the Grinch who stole Christmas.”

O’Neill said the impact of interest rate movements on retirees is usually offset by regular adjustments to the Centrelink deeming rates upon which pensions are calculated.

But the deeming rates haven’t moved since March 2010 and calls to the federal government to adjust deeming rates have been met with silence.

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