RBA lowers cash rate by 0.25%

Cheers Tom.

This is the pre-Christmas jump start for retail. Let's see what the banks do, if they don't drop it far enough the I think the RBA will drop it again in Nov.

Interesting times we live in.

Cheers

D

Its about time these up starts at the Reserve Bank got out of there ivory tower in Martin Place and realised the economy isn't doing so great and not to mention us property investors are struggling as well.

I'm hoping they keep dropping the interest rates so I can afford a Mercedes for the missus next year and not have to put up with her complaining about the performance of the BMW.

Over

TheBish  

Jamie i think you and most economists alike especially given the news that capital property prices have increased quite significantly.

I personally thought they would wait to see the results of the 3rd quarter GDP figures.

Not convinced they will go again Melbourne Cup day.

Bank of Qld starting the ball rolling with a 20bps cut this afternoon.

Cheers

Yours in Finance

Personally, I’m not expecting much from the banks. After all, they don’t borrow from the Reserve their funds come from deposits & borrowing (locally or overseas) so what the Reserve does and the goose say have very little bearing on the outcome.

In saying that, I read some commentary this morning that we are in a 3 year downward cycle for interest rates and we should be expecting more cuts. The 3 year fixed rates are well below the standard mortgage rates on offer.

Be interesting to see who this all plays out over the next 6 months or so. Given we are apparently saving more than we have done for a long time I wonder how much of the rate reduction will flow through past the 'save' and 'pay down debt' and 'the banks not passing on full reduction' issues we currently have.

Probably not a good sign for the wider economy – especially with some 'economic experts' suggesting more rate reductions will be in the offing.

Everytime the 'economists' make a prediction I just think of this quote “If all the economists in the world were laid end to end, they would still not reach a conclusion.” (George Bernard Shaw)

I say we get a pool going next month! Maybe get one of the dolphins at sea world to make a prediction next time.

Cheers

D

@richard.

Have seen another economist suggest we'll get a full 1% drop in rates over the next 12 months. Well we have had 0.25 so it will be interesting to see what transpires.

What is that joke – send two economists into a room with the same set of figures and you'll end up with three different opinions.