Most economists predict RBA interest rate cut

By Mozo ·

The majority of economists firmly believe that the Reserve Bank of Australia (RBA) will slash interest rates again this month.

A survey conducted by the Australian Associated Press indicated that 13 out of 14 economists are predicting the RBA to reduce rates by a further 0.25 per cent.

The Reserve Bank had already reduced rates to 4.25 per cent in November and December, but this has had limited impact on home loans and other markets thus far.

Even if rates are trimmed, it does not necessarily mean that Australia's major banks will pass the reduction on to their customers.

Chief economist at AMP Capital Shane Oliver told the news provider that there is a strong case to cut the cash rate.

"The jobs market is weakening, retail sales and housing construction are weak, house prices are falling and consumer and business confidence are sub-par," he said.

HSBC chief economist Paul Bloxham recently told the Herald Sun that the ongoing mining boom has stood the country's economy in relatively good stead.

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