Rate cut may lead to riskier investing

Original article by Sarah Turner
The Australian Financial Review – Page: 31 : 13-Jun-19

Anthony Doyle of Fidelity International says Australian savers are likely to seek out higher-yielding and higher-risk investments following the Reserve Bank’s decision to reduce the cash rate to a new low of 1.25 per cent. He notes that there was a similar trend in the UK following the global financial crisis, with Britain’s cash rate reaching a low of just 25 basis points. Doyle also expects the search for yield to bolster Australia’s corporate bond market.

CORPORATES
FIDELITY INTERNATIONAL PTY LTD, RESERVE BANK OF AUSTRALIA, M&G INVESTMENT MANAGEMENT LIMITED

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