Interest rates – where now for the RBA?

From CBA chief economist Michael Blythe:

  • Has pushed the forecast for RBA cash rate hike from February back to August 2015 now (if we’re not all dead from Ebola by then, that is)
  • Says “The RBA needs more of it to assess emerging trends. They are prepared to buy it through macroprudential initiatives. And near-term inflation trends offer some time.”

Macquarie, though, is mentioning about risk of RBA cash rate cut

  • Risk of a cut has grown as the RBA
  • Now that the RBA is prepared to use macro-prudential tools to deal with the housing market, it leaves some leeway to lower the cash rate
  • BUT … Macquarie go on …. their forecast is unchanged that the RBA will hike the cash rate next in February 2016