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Weekly Economic Commentary

Weekly Economic Commentary

Categories: General, General

Financial market re-pricing of the official cash rate over the past few months has been significant in moving from an RBA rate increase to now forecasting a rate cut. Analysts argue that the move is justified given the increased uncertainty over the US-China trade negotiations, Brexit, the US Federal Reserve’s change to a “pausing” monetary policy stance; weaker than expected economic data releases and the move by the RBA from a tightening to a neutral bias.

The risk that the RBA lowers the official cash rate later this year will require economic data to continue to surprise on the weaker side of expectations, namely falling house prices, continuing low inflation, a slowdown in GDP and rising unemployment.

Rates chart

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Source: Rural Bank


Disclaimer: Whilst all care has been taken in compiling the information, the information should not be relied upon as substitute for professional advice where necessary. Rural Bank accepts no responsibility for the accuracy, completeness or timeliness of the information and disclaims all liability in relation to any loss or damage suffered by the use of or reliance upon any information contained herein or in any attachment or annexure hereto by any person. Rural Bank – A Division of Bendigo and Adelaide Bank Limited ABN 11 068 049 178 AFSL 237879