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Room for more rate cuts

By Reporter 19 October 2012 | 1 minute read

There is still the opportunity for further reductions in the interest rate, according to a leading data house.

Even while the Reserve Bank hasn’t suggested any future cuts, with current inflation tracking below 2 per cent, there is still the chance another may be seen, RP Data noted in this week’s Market Update.

“The Consumer Price Index for September is to be released on October 24; if the reading remains as low as it was in June, the chances of a further twenty five basis point rate will certainly increase,” the report said.

The higher unemployment rate seen last month will also contribute to the chance for another cut.

While this may be the case, RP Data still expects the October rate cut to produce positive results for the market when the September data is processed.


The cumulative cash rate cuts since November last year currently sits at 150 basis points.

Room for more rate cuts
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