Rates to drop, then rise in 2015: Westpac's Bill Evans
Bill Evans, who has been cheekily dubbed the interest rate whisperer by the Daily Telegraph's business columnist Scott Rochfort, has issued a revised 2015 rates advisory.
"While we still expect rates to be on the rise in 2016 as the world economy gathers considerable momentum, we now expect the RBA to cut rates further in the early months of 2015 in an effort to bolster domestic demand and lower the AUD before evidence on the world economy becomes clearer around the middle of the year," he said.
"We now expect the RBA to cut rates by 25bps in February and again in March prior to another period of stability."
The surprise call came on late Thursday afternoon shortly after Deutsche Bank and Goldman Sachs made similar forecasts amid signs the slowing pace of economic growth in Australia.
Evans noted on housing, the RBA has sensed a clear moderation in price appreciation in recent months.
"The Bank also has some scope to use macro prudential tools to contain any further sharp upswing in investor housing activity, if it were to occur," Evans said.
"Of course the next Board meeting is not until 3 February and much could change over that period."