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Weekly Economic Commentary

Weekly Economic Commentary

Categories: General

Our current interest rate forecast has the RBA’s “period of stability” in the official cash rate extending to the second half of 2015 when we see a modest tightening cycle beginning. This is in line with the current financial futures market re-pricing (refer chart below).


The G20 leaders agreed over the weekend to take measures that would boost their economies by a collective $2 trillion by 2018 as they battle variable growth and the threat of a European recession. The group submitted close to 1,000 individual policy changes that they said would lift growth and said they would hold each other to account to ensure they are implemented.

The press is reporting that Australia and China will sign a Free Trade Agreement this afternoon. Reports suggest that the depth and breadth of concessions made by China are relatively extensive and, in some cases, exceed industry expectations with the benefits to Australia exceeding previous estimates of $18bn over 10 years. A range of agriculture, horticulture and services industries stand to benefit via reduced tariffs and/or less restricted access to China’s markets. Private Chinese investors will have the foreign investment review threshold raised to $1bn.

Source: Rural bank


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