Nearly three quarters of mortgage brokers expect rates to fall over the coming quarter, new research has revealed.
According to a sentiment survey run by The Adviser, sister publication to Real Estate Business, 73.1 per cent of mortgage brokers believe rates will fall in the next three months – up 68.4 per cent on last quarter.
Just 1.8 per cent of brokers expect rates to rise before Christmas – down from 41.4 per cent last quarter.
The sentiment poll results were based on just over 200 responses to an online survey conducted early this month.
Finance Made Easy’s Tony Bice is one broker who expects rates to fall in the not too distant future.
“I do believe there is room for rates to move downwards,” Mr Bice said.
“Rates have been on hold for so long now that I think we will see movement very soon. Also, if you look at fixed rates it is fair to assume the cash rate could be set to fall.
“When lenders move their fixed rates downwards it generally is an indication that the cash rate is about to fall. We have seen a lot of movement around fixed rates recently, so I wouldn’t be surprised to see the official cash rate drop from 4.75 per cent.”
And Mr Bice is not alone in his predictions.
Last week, ANZ’s head of Australian economics Ivan Colhoun said the official cash rate will be slashed by 25 basis points to 4.5 per cent at the November meeting.
The bank believes the RBA will then remain on hold until early next year before cutting rates again.
The forecast came after the RBA last week flagged that an interest rate cut could be ordered and the ANZ job advertisement series, published yesterday, showed a 2.1 per cent decline in job position vacancies.
"There is scope for the RBA to reduce interest rates a little as insurance against weaker than expected growth and even higher unemployment," Mr Colhoun said.