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Around four-fifths of brokers think that the Reserve Bank of Australia will hold the cash rate at its current level of 1.5 per cent until 2017, a survey has revealed.
According to a survey from online marketplace HashChing, of the 130 brokers asked about interest rates ahead of the RBA’s board meeting earlier this week, 93 per cent correctly predicted that interest rates would hold in October, while 79 per cent said that they thought rates would stay on hold for the remainder of the year.
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However, just over a fifth (21.4 per cent) of respondents said that they thought there would be another cut in 2016.
The latter group would appear to agree with one the country’s senior economists, as AMP Capital’s chief senior economist Shane Oliver has forecast the next rate call to be a cut.
Commenting earlier this week, Mr Oliver said that while the RBA was quite relaxed about a strengthening in some areas of the housing market, it was probably “waiting for the surge in apartment supply to cool property prices”.
He added: “Given the recent rebound in auction clearance rates, Sydney and Melbourne property prices' continuing growth solidly after huge gains over the last four years – 60 per cent in Sydney, 40 per cent in Melbourne – and the risk that the apartment building boom will go way beyond the point of being healthy, my view remains that the RBA is a bit too relaxed about home prices.”
Mr Oliver also remarked that the RBA did not repeat its comments from its July meeting with regards to upcoming inflation data, suggesting “its bias on interest rates is neutral”.
Additionally, with inflation risks currently skewed to the downside, record-low growth in domestic wages, and the potential for further appreciation of the already high Australian dollar, Mr Oliver said a cut to the cash rate is likely to come at next month’s meeting.
“We remain of the view that the RBA will cut rates again at its November meeting when it reviews its economic forecasts after the release of the September quarter inflation data in late October,” he said.
[Related: Home loan rate cuts diverge from RBA hold]
