The RBA has cut interest rates 12 times since November 2011, from 4.75% to an historic low of 1.50%, and some believe the easing cycle may be over (refer chart below). Although rates may have bottomed, that doesn't mean they are likely to rise any time soon, with the market still retaining a slight easing bias given the weak inflation outlook.
Therefore, many pundits are unwilling to call last week’s RBA decision as the bottom of the official cash rate cycle just yet. But given the RBA’s role as a reluctant rate cutter, many have pushed back the call for one more rate cut to mid-2017.
US Election Update
With only a few days to go now, the US election race is neck and neck, resulting in anxiety hitting financial markets. US equities tumbled to their lowest level since July after the latest ABC News/Washington Post poll showed Donald Trump leading Hillary Clinton 46% to 45%. However, according to the latest New York Times/CBS poll, the Democrat holds a 45% to 42% edge nationally. The renewed FBI investigation into Clinton’s e-mails has raised the prospect of a closer-than-expected result, keeping markets on edge. Gold jumped, the US dollar weakened and the Swiss franc surged. Meanwhile, Mexico's peso, a barometer of Trump's prospects, weakened the most among major currencies.