RBA August 2016 Interest Rate Decision

Discussion in 'Markets & Economies' started by Roswell Crash Survivor, Jul 30, 2016.

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  1. Roswell Crash Survivor

    Roswell Crash Survivor Well-Known Member Silver Stacker

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    Any thoughts on what will the RBA's decision will be on the 2nd August?

    What does this implied yield curve 'say' to you?

    I am asking open-ended questions. All view points are welcome.
     
    Roswell Crash Survivor, Jul 30, 2016
    #1
  2. House

    House Well-Known Member Silver Stacker

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    Down.
     
    House, Jul 30, 2016
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  3. long88

    long88 Member

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    Down

    So my million dollar repayment cost me less in interest
     
    long88, Jul 30, 2016
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  4. Killface

    Killface Well-Known Member Silver Stacker

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    I guess the linked graph carries a second-order implication of a rate cut but maybe later in the year.

    I can tell you now I won't get a 0.25% reduction in my mortgage rate; the returns are diminishing with each RBA cut.

    Off-topic, what are people's thoughts on fixing a mortgage interest rate now that they are lower than variable rates? If you look at the US, official rates are 0.5% but mortgage rates are barely lower then ours. Savings interest rates on the other hand...
     
    Killface, Jul 30, 2016
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  5. CriticalSilver

    CriticalSilver New Member Silver Stacker

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    That's a good question. I will be keenly watching how any future RBA rate cuts impact mortgage interest rate. If negligibly, then locking in a fixed rate may provide some protection and advantage over the course of the investment.
     
    CriticalSilver, Jul 30, 2016
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  6. alor

    alor Well-Known Member Silver Stacker

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    will there be a leak again a few minutes before the announcement like last time?
     
    alor, Jul 30, 2016
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  7. Killface

    Killface Well-Known Member Silver Stacker

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    Not mine.. I assumed they were all keeping a bit for themselves. At these low rates I would expect the gap to increase with each cut.
     
    Killface, Jul 30, 2016
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  8. bubblebobble2

    bubblebobble2 Administrator Staff Member Silver Stacker

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    I bet it'll stay as is... Cause RBA knows that bank will not pass fully.... And if banks end up jacking up, then RBA will definitely put 25 points the following month
     
    bubblebobble2, Jul 30, 2016
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  9. raven

    raven Well-Known Member Silver Stacker

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    sounds like reasonable logic !
    therefore they'll cut probably
    :)
     
    raven, Jul 30, 2016
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  10. argento

    argento Well-Known Member Silver Stacker

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    Down.....Aussie dollar is too high
    RBA still want the to see the AUD in 60's not 70's
     
    argento, Jul 30, 2016
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  11. Topherclaus

    Topherclaus Active Member

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    Actually it's going up 0.5.

    Maintaining my theory that there's an inverse relationship between my calls and reality.
     
    Topherclaus, Jul 30, 2016
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  12. Old Codger

    Old Codger Active Member Silver Stacker

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    Personally, I feel that the RBA would much prefer to hold off, in fact wanted to hold off last time, and to keep rates at 2%.

    I am sure they know as well as we do what is on the horizon, and that 2% would be helpful in 4x .5% or maybe 1x 1% and 2x .5% reductions all in quick succession.




    JMO


    OC
     
    Old Codger, Jul 30, 2016
    #12
  13. Caput Lupinum

    Caput Lupinum Well-Known Member Silver Stacker

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    I think NAB didn't pass on the full cut?

    This is going to become an issue though, the further the RBA cuts to zero as it's going to be harder for the banks to turn a profit and the costs of their short-term overseas borrowing isn't getting any cheaper. At the moment, the banks are hoping that they can still stimulate the housing market by passing on the cut but it wouldn't surprise me if they all didn't pass on the full cut next time.
     
    Caput Lupinum, Jul 30, 2016
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  14. Caput Lupinum

    Caput Lupinum Well-Known Member Silver Stacker

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    Everything that I look at is pointing to a cut

    2 year Australian bonds are yielding 1.46%

    RBA rate indicator is saying there's a 64% chance of a rate cut but that was before the weak US GDP figures last night

    Headline inflation is still soft even though core inflation was a little higher than expected

    PPI figures and trade figures were soft

    The Aussie dollar is stronger than the RBA would like, but even if they do cut the economy isn't weak enough yet to maintain a lower currency. It wouldn't surprise me if the RBA cuts, the Aussie sells off briefly (a day or two) only to rally at least back to where it is now on the weak US GDP figures pointing to the FED not raising interest rates September.

    Anyway, I'm saying the RBA will cut
     
    Caput Lupinum, Jul 30, 2016
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  15. Caput Lupinum

    Caput Lupinum Well-Known Member Silver Stacker

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    Caput Lupinum, Jul 30, 2016
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  16. aleks

    aleks Well-Known Member Silver Stacker

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    HODL, don't think they will cut.
     
    aleks, Aug 2, 2016
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  17. Roswell Crash Survivor

    Roswell Crash Survivor Well-Known Member Silver Stacker

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    Under 5 minutes to go.

    I'm not seeing much conviction in the USDAUD movements on the forex market.
     
    Roswell Crash Survivor, Aug 2, 2016
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  18. Roswell Crash Survivor

    Roswell Crash Survivor Well-Known Member Silver Stacker

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    RBA: 25bp cut.

    Thank You for participating.
     
    Roswell Crash Survivor, Aug 2, 2016
    #18
  19. aleks

    aleks Well-Known Member Silver Stacker

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    hory shet
     
    aleks, Aug 2, 2016
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  20. BuggedOut

    BuggedOut Well-Known Member Silver Stacker

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    AUD down less than half a cent on the move and the ASX has barely responded.

    Mr Market was hardly surprised......
     
    BuggedOut, Aug 2, 2016
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