There are no arguments as to what the Reserve Bank’s cash rate decision will be today, with the official interest rate tipped to remain on hold when the central bank announces its decision this afternoon. However, rates are tipped to head north next year.
A monthly Reserve Bank survey conducted by finder.com.au found that all 31 economists and analysts were unanimous in expecting no movement to the cash rate at the October meeting.
According to finder, several experts cited that the change in Prime Minister has had a positive effect on the market, with the recent softening of the Australian dollar also being beneficial to businesses exporting goods and services.
While the majority believe the cash rate will remain on hold at 2% for the remainder of the year, two economists – Jonathan Chancellor from Property Observer and Shane Oliver from AMP
Capital – predict the cash rate will but cut once more, in November this year.
However, the survey also found that the cash rate’s run at its record low is coming to an end. Over half (60%) predict that the cash rate will begin to head north next year, while the remaining 40% predict a rise to occur beyond 2016. Of those who expect the cash rate to increase in 2016, about half predict this will occur in the last quarter of 2016.