Powered by MOMENTUM MEDIA
realestatebusiness logo
Subscribe to our newsletter SIGN UP

Experts divided on interest rate cut

05 May 2015 Staff Reporter

Opinions are split on whether the Reserve Bank of Australia will today leave the cash rate on hold or move it to another record low setting.

Opinions are split on whether the Reserve Bank of Australia will today leave the cash rate on hold or move it to another record low setting.

According to a finder.com.au survey of 34 economists and commentators, 16 expect rates to fall, while 18 expect rates to remain at 2.25 per cent.

Bank of Sydney deputy chief executive Steven Pambris told finder.com.au the Reserve Bank would leave rates on hold so it can see what measures the federal government implements in this month’s Budget.

Heritage Bank chief treasury officer Paul Williams also predicts rates will remain on hold: “The Reserve Bank retains a bias to ease, but appears conscious they have limited monetary policy ammunition left, therefore they are being extremely cautious.”

AMP Capital chief economist Shane Oliver told finder.com.au a cut is coming and will probably happen today.

“Growth is sub-par, the business investment outlook is weak, the Australian dollar is still too high and inflation is benign,” Mr Oliver said.

Rate cuts have also been forecast by CommSec economist Savanth Sebastian and BetaShares chief economist David Bassanese, with the former pointing to weak non-mining business investment and the latter highlighting a firm Australian dollar and weak iron prices.

According to the survey, 21 of the 34 respondents expect the Reserve Bank to make at least one more rate reduction this year, while six have forecast two cuts.

Experts divided on interest rate cut
lawyersweekly logo
FROM THE WEB
Recommended by Spike Native Network
Listen to other installment of the Real Estate Business Podcast

Network or independent?

Independent
Network, the bigger the better
Network, but midsized
Niche group, small and agile
Do you have an industry update?
REAL ESTATE BUSINESS NEWSLETTER
Ensure you never miss an issue of the Real Estate Business Bulletin. Enter your email to receive the latest real estate advice and tools to help you sell.