interest rate cut

likely to see interest rate cut tomorrow?

Fingers crossed

 

Half of bngger all, won't make much of a difference to repayments.

 

That's if the banks pass on the full cut if indeed the RBA does reduce rates..

 

100% cut.

I have a new formula says so.

 

What is the point in interest rate cut when:

• All the extra money will just be soaked up by property leaving the remaining economy untouched. The only improvements will be in median prices and serviceability of a few investors.
  
• RBA will mostly be undoing what APRA has done.
• There is hardly anything remaining in RBA's tank, when we get close to zero.

 

1% increase today!

 

Well we know how much you hate NGing, so there is a silver lining because if the rate cuts keep coming NGing will disappear.

No government policy intervention and more tax revenue.
A win win situation.

 

Market expectation is around 60% chance of cut. So who knows.

 

Not a win win, there are losers (savers, banks and their share holders, super, FHBs, business and consumer confidence...)

No case for a rate cut

But, as former Reserve Bank governor Ian Macfarlane told The Australian Financial Review, the 2-3 per cent target was designed for a different era: when inflationary expectations needed to be "anchored" after being clubbed by the early 1990s recession. No-one imagined it could be used to drive interest rates close to zero just to induce inflation up into the target zone. That surely would be mindlessly mechanical.

Rate cuts have largely been ineffective as cheap credit (< 2.5%) has been available for three years now. Why would it be any different now.

What is the plan when we hit zero ? IMHO Fiscal policy is the final solution and the quicker it happens the better.

 

market sentiment, may get more buyers jump in? I think this is what happened with last IR fall

 

Maybe read up on what's happened in Japan and the country's real GDP,and the effects it would have on this country..
But watching the way the perfectly transparent "AD" is trading over the past few hours ,i think rates will stay the same..

 

Dunno about a cut. I'm 60-40 on a cut. But either way, I'm 100% sure the banks wont pass all of it on.

 

I agree. The cost of lending would have to fall for an interest rate cut to be passed on. That doesn't automatically happen just because official interest rates are cut.

 

I like cuts for personal reasons as much as the next guy, but what I'd really like to see is rates going up. Dropping rates when they're already low is a sign of a sick economy and that's not good for anyone in the long run. It doesn't matter how low your rates are, you can't afford the repayments if you don't have a job.

Rates increasing is a sign of an improving economy which leads to business and employment growth, then wage growth. In turn this leads to better housing affordability without a market crash.

Endless low rates simply leads to stagnation and even deflation.

I'm hoping that the RBA will keep rates where they are and working with the broader government to find ways to have reason to increase rates in the future.

I also wish for world peace.

 

When is the announcement? #lazyweb

 

2 or 3 pm I think.

 

Lunchtime today - WST

Prediction is rates will stay on hold and cut in the next few months with banks passing on some of it.

 

2:30 pm announcement

 

0.25% cut

 

Reserve Bank of Australia: RBA cuts the cash rate to all-time low of 1.5% – live