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The vast majority of experts have predicted that the Reserve Bank will keep the cash rate unchanged at today’s monthly board meeting.
All but one of the 35 economists and commentators surveyed by comparison website finder.com.au expect interest rates to remain at the record low 2 per cent.
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While many of those surveyed noted the rising Aussie dollar may be of some concern to the board, there is still not enough of a reason to move the official cash rate from where it currently sits.
“There has been no significant deterioration in the Australian economy since last month’s RBA meeting,” LJ Hooker CEO Grant Harrod said.
“The recent drop in the unemployment rate will see the RBA hold rates steady this month.
“However, the strengthening Australian dollar and low inflation provide scope for a cut mid-2016.”
Queensland University of Technology adjunct professor Noel Whittaker was the only expert to predict further easing at today’s meeting, based on the recent strength of the Aussie dollar.
Twenty-one experts predicted no cash rate movements for the rest of the year, with the majority of the group forecasting a rate rise in 2017 at the earliest. Only three experts expect a cash rate fall beyond 2016.
“[The RBA] may wait to see if the higher dollar will deflate,” Domain Group chief economist Andrew Wilson said.
“Upward pressure on bank rates may force [the RBA’s] hand sooner rather than later.”
[Related: Banks under pressure to raise rates]
