Economists, experts tip RBA to hold cash rate: finder.com.au

Economists, experts tip RBA to hold cash rate: finder.com.au
Economists, experts tip RBA to hold cash rate: finder.com.au

An overwhelming majority of economists and financial experts polled for a recent survey believe the Reserve Bank will keep the current cash rate on hold at 2% ahead of its upcoming monthly board meeting.

Only one economist in the Finder.com.au Reserve Bank Survey said the cash rate will fall.

78% of respondents don't think the cash rate will move this year and 16% tip the RBA to reduce it by year's end. Only one respondent thinks it will rise by the end of 2015. Some 53% expect the cash rate to start rising in 2016 and 44% believe it will rise past 2016.

Finder.com.au money expert Michelle Hutchison said the survey found that it’s not a matter of ‘if’ the cash rate will rise but, rather, ‘when’.

However, she warns, there’s no need to panic.

"Buyers who are planning to wait until the property market settles may want to think again," she said.

“Almost three in five experts (59%) said that next mortgage season (September-November 2016) will not necessarily be a better time to buy than this coming mortgage season, but rather is likely to be the same as this season. 

“However, more than one in three experts (11 experts or 34%) expect auction clearance rates to fall, despite mortgage season being traditionally billed as the hottest time to buy and sell.”

According to the survey, the Reserve Bank is still assessing the impact of the latest two rate cuts in February and May and an improving labour market and a lower Australian Dollar are factors that may contribute to the Reserve Bank’s decision to keep rates on hold on Tuesday. 

For more information from Finder.com.au on the current cash rate, click here.

Tags: 
Interest Rates

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