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‘RBA will cut again’, says economist; The Kouk
Topic Started: 14 Dec 2016, 09:37 AM (1,624 Views)
Rufus
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‘RBA will cut again’, says economist
Stephen Koukoulas
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A leading Australian economist has predicted that the Reserve Bank of Australia will “reluctantly” cut interest rates next year, due to concern over house prices.

There has been ongoing speculation that the cash rate could rise next year, following on from four months of record-low interest levels (of 1.50 per cent). However, Stephen Koukoulas, former chief economist of Citibank and senior economic adviser to the Australian Prime Minister, told Mortgage Business he believes that there will have to be another cut next year.
Mr Koukoulas commented, “I think the RBA will cut again, reluctantly, because they're worried about house prices, particularly in Sydney and Melbourne [where median house prices are at record highs of $1.06 million and $770,000 respectively]. 
“I think, maybe early in the New Year (if we get another low inflation result at the end of January), if the labour market remains sluggish, the risk reward for the RBA is just to trim rates a little more, which might take a little bit of heat out of the Aussie dollar.”
He added that he believed the Reserve Bank should have cut rates earlier, to free up cash flow for both businesses and “indebted households”, who are increasingly struggling to meet mortgage repayments. 
The comments from the Market Economics managing director echo those of AMP Capital chief economist Shane Oliver, who recently suggested that it was still “way too early” to rule out further rate cuts next year. 
Like Mr Koukoulas, Mr Oliver stated that he was “allowing for one rate cut in the first half of next year”, adding that “regardless of whether there will be further cuts or not, a rate hike remains a 2018 story at the earliest”.
Both economists also highlighted that mortgages could come under the microscope next year, with Mr Koukoulas suggesting that the RBA may be tempted to “lean on the regulators” so that they’re more “careful in how much they're lending for the housing market”, while AMP’s economist said that the Reserve Bank “may also need to offset increases in bank mortgage rates that are being driven by the rise in global bond yields”. 
Their comments come after a recent RateCity.com.au analysis of more than 30 key economic indicators suggested that the Reserve Bank’s easing cycle had ended, and the likelihood of a rate hike next year was mounting.
“Australians should get ready for rates to go up next year to cool our hot housing market,” RateCity.com.au data insights director Peter Arnold said.
Mr Arnold noted banks have already started moving their fixed rates higher, with Westpac the first major to do so.
“With that, many lenders [are] moving fixed rates up. It’s the best sign that we have that a variable hike is on the way,” he said.
Mr Arnold pointed to findings from international forecasters, namely the OECD, which said that rate hikes were needed to “unwind tensions from the low-interest environment, notably in the housing markets”.
Take risks - if you win you will become wealthy, if you lose you will become wise
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Simon_S
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Wow where do you start......

Quote:
 
Mr Koukoulas commented, “I think the RBA will cut again, reluctantly, because they're worried about house prices, particularly in Sydney and Melbourne


They are worried about house prices.........Going down i guess.

Quote:
 
He added that he believed the Reserve Bank should have cut rates earlier, to free up cash flow for both businesses and “indebted households”, who are increasingly struggling to meet mortgage repayments.


What?! Indebted Households struggling to meet mortgage Repayments......

Quote:
 
while AMP’s economist said that the Reserve Bank “may also need to offset increases in bank mortgage rates that are being driven by the rise in global bond yields”.


What?! they have to offset the rising cost of Overseas money...........

Quote:
 
With that, many lenders [are] moving fixed rates up. It’s the best sign that we have that a variable hike is on the way,” he said.


What?! Variable hikes are on their way........

But Everyone here tells me that the RBA is only concerned with Inflation and Unemployment targeting...

Fun Times indeed.


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Trollie
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It would be the final blow for the hold outs. Prices will continue to rise in 2017
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Simon_S
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Trollie
14 Dec 2016, 10:23 AM
It would be the final blow for the hold outs. Prices will continue to rise in 2017
The final blow......

AHAHAHAHAHAHAHAHAA

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herbie
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Ya could just PM me 'n say "Ha, ha, ha - Tha RBA's gunna f*** youse savers up tha arse a bit more herbie" - Like sheesh, does ya REALLY have ta announce it ta whole damn world?

Like sometimes I reckon you're just a god damn sadist Rufus - LOL
A Professional Demographer to an amateur demographer: "negative natural increase will never outweigh the positive net migration"
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Rastus2
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herbie
14 Dec 2016, 11:39 AM
Ya could just PM me 'n say "Ha, ha, ha - Tha RBA's gunna f*** youse savers up tha arse a bit more herbie" - Like sheesh, does ya REALLY have ta announce it ta whole damn world?

Like sometimes I reckon you're just a god damn sadist Rufus - LOL
can you post in English instead of Gibberish ?
Shadow - Defrauded his Bank ? 2015 I have 9 different loans and my bank had no idea which ones were personal and which were investment. They had half of them classed incorrectly. When this change came in they asked me to tell them if any personal loans were incorrectly classed as investment, which I did, and they switched them to personal for the lower rate. They also had a couple of investment loans incorrectly classed as personal. They didn't ask me about those. So they stay on the lower rate too. Worked out pretty well. :)
Shadow - 2008 Sydney Median House Price 1.25M by 2014-2015

Shadow : I think this boom has already begun in several cities. My prediction :
Peak of boom: 2014-2015. Sydney Median Price: $1,250,000 Bottom of bust: 2017-2018. Sydney Median Price: $1,100,000

Shadow's Original 2010 House Boom and Crash prediction http://s836.photobucket.com/user/rastus22/media/shady-orig-2010-chart.png.html?sort=3&o=0

Shadow's attempt to edit his 2010 chart in 2015 and replace it with one that does not show a crash in 2013 http://s836.photobucket.com/user/rastus22/media/Screen%20Shot%202015-06-06%20at%207.12.52%20pm_1.png.html
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herbie
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Rastus2
14 Dec 2016, 12:11 PM
can you post in English instead of Gibberish ?
Wot? When I says ya a "lying piece of shit" ya struggles ta grasp me meanin' does ya??? - LOL

As in over here: http://australianpropertyforum.com/topic/30036757/7/ - LOL LOL LOL

Anyway, f*** continually bein' f***ed by tha RBA - It's time I bought another house (for cash) ... Hmmm.
Edited by herbie, 14 Dec 2016, 02:11 PM.
A Professional Demographer to an amateur demographer: "negative natural increase will never outweigh the positive net migration"
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Rastus2
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herbie
14 Dec 2016, 12:45 PM
Wot? When I says ya a "lying piece of shit" ya struggles ta grasp me meanin' does ya??? - LOL

As in over here: http://australianpropertyforum.com/topic/30036757/7/ - LOL LOL LOL

Anyway, f*** continually bein' f***ed by tha RBA - It's time I bought another house (for cash) ... Hmmm.
nope, still gibberish instead of english.

Very litt of this is English
" youse savers up tha arse a bit more herbie" - Like sheesh, does ya REALLY have ta announce it ta whole damn world?"
Shadow - Defrauded his Bank ? 2015 I have 9 different loans and my bank had no idea which ones were personal and which were investment. They had half of them classed incorrectly. When this change came in they asked me to tell them if any personal loans were incorrectly classed as investment, which I did, and they switched them to personal for the lower rate. They also had a couple of investment loans incorrectly classed as personal. They didn't ask me about those. So they stay on the lower rate too. Worked out pretty well. :)
Shadow - 2008 Sydney Median House Price 1.25M by 2014-2015

Shadow : I think this boom has already begun in several cities. My prediction :
Peak of boom: 2014-2015. Sydney Median Price: $1,250,000 Bottom of bust: 2017-2018. Sydney Median Price: $1,100,000

Shadow's Original 2010 House Boom and Crash prediction http://s836.photobucket.com/user/rastus22/media/shady-orig-2010-chart.png.html?sort=3&o=0

Shadow's attempt to edit his 2010 chart in 2015 and replace it with one that does not show a crash in 2013 http://s836.photobucket.com/user/rastus22/media/Screen%20Shot%202015-06-06%20at%207.12.52%20pm_1.png.html
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herbie
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Rastus2
14 Dec 2016, 02:35 PM
nope, still gibberish instead of english.

Very litt of this is English
" youse savers up tha arse a bit more herbie" - Like sheesh, does ya REALLY have ta announce it ta whole damn world?"
I'm not sure that comment of yours has got much ta do wif interest rates Rastus? - LOL LOL LOL

Hmmm - Just hopped off tha phone ta a family member down in a NSW regional - Learnin', learnin', learnin'; Lookin', lookin', lookin' ... :)
A Professional Demographer to an amateur demographer: "negative natural increase will never outweigh the positive net migration"
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Jon Snow
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Aren't we already at NAIRU?
Speak when you are angry and you will make the best speech you will ever regret.
Ambrose Bierce
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