CBA: RBA to cut official interest rates to 1.25% in 2016

Read more: CBA is the first of the big four banks to predict two more Reserve Bank rate cuts in 2016

No wonder they passed on the first cut straight away. They are all predicting more cuts from RBA (probably after the election) which is when they will hold off on passing the full cut.

More importantly, if the RBA does cut interest rates what does that say about the economy in general and specifically the property market? I am reading one new article almost everyday about the glut of new apartments about to hit the market when demand is subdued. Any significant price reductions in apartments will eventually impact standalone house price as well.

Let's just hope the unemployment rate doesn't rise much otherwise property market definitely will suffer even under low rates.

Cheers,
Oracle.

 

If the interest rate gets that low the country is in massive trouble. An interest rate that low is basically tanking all fundamentals of economics to try and hide things.

It's a symptom of society these days, bad things aren't allowed to happen and everyone gets a participation award but we've basically created an economy that is so full of holes that we've used all the duct tape and are now sticking masking tape on to try and stop the bleeding...

 

Will be interesting to watch this play out.

Well worth keeping an eye on the Cash Rate Futures Implied Yield Curve :

http://www.asx.com.au/data/trt/ib_expectation_curve_graph.pdf

Here's what we're looking at today:



A year ago, this was the picture: