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RBA Rate Cuts

Discussion in 'Property Finance' started by Dean Collins, 19th Jul, 2016.

  1. Dean Collins

    Dean Collins Well-Known Member

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  2. Jerry O

    Jerry O Well-Known Member Premium Member

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    hoping for Xmas in July to happen with St George? I don't think it will happen.. :D:D:D
     
  3. D.T.

    D.T. Adelaide Property Manager Business Member

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    Just because banks are getting their funds cheaper, doesn't mean they have to bring their prices down.

    Same as the furniture store, they might get a cheaper batch of coffee tables in doesn't mean they can't charge their normal price for them.
     
  4. Dean Collins

    Dean Collins Well-Known Member

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    Based on this article I think the fix is in and definitely going to get a 0.25% drop in order to help exports.
    - Aussie dollar could rally to US80c unless RBA cuts rate, AMP says

    Now the question is will we get it passed on to borrowers...... they better.
     
  5. Kinnon Bell

    Kinnon Bell Finance Broker

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    Doubt it. If anything, if there's a cut they'll pass on a nominal amount. With the election over, cost of funds and increasing capital adequacy ratios the banks need to increase their income and cash holdings somehow.
     
  6. Peter_Tersteeg

    Peter_Tersteeg Finance broker and strategist Business Member

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    I'll take a contrary view. The banks will pass on about rate cuts in full. There might be a 0.05% exception here or there, but generally they don't want the bad publicity...

    ...and with the other hand they'll take it away by offering lower discounts, making pricing adjustments out of cycle with the RBA, etc.

    There's plenty of ways for the banks to raise rates without being so obvious about it.
     
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  7. Brady

    Brady Well-Known Member

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    Completely agree, it's exactly what happened last rate cut.

    Most banks passed the full 0.25% rut cut, but in the following weeks the discount that was offered was lower.
     
  8. albanga

    albanga Well-Known Member

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    Spot on! This is basic marketing.
    I literally had a friend the other day say to me "I don't like bank X, they always seem to pass on the rate cuts last, unlike bank Y".

    Bank Y in his eyes just become superior based on nothing more than a cheaper rate for 3 weeks (if the rate was even cheaper!)
     
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  9. JDP1

    JDP1 Well-Known Member

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    Yeah, i would agree. They may cut a bit more of business lending rates. Nominal resi lending rates. Both together probably wont even equal thr rba cut.they will keep some profit for themaelves.