INTEREST RATES – AUSTRALIA

Macquarie tips 1pc cash

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Original article by Vanessa Desloires
The Australian Financial Review – Page: 27 : 20-May-16

James McIntyre of Macquarie Group says the Reserve Bank will have further ease monetary policy unless the Australian Government stimulates the economy with fiscal policy measures. He says this is unlikely, which will leave it to the central bank to put downward pressure on the dollar via rate cuts. McIntyre expects the cash rate to fall to at least one per cent.

CORPORATES
MACQUARIE GROUP LIMITED – ASX MQG, RESERVE BANK OF AUSTRALIA, BLOOMBERG LP, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB

Wage growth slumps to 18-year low

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Original article by Mark Mulligan
The Australian Financial Review – Page: 10 : 19-May-16

Data from the Australian Bureau of Statistics shows that wages grew by just 0.4 per cent in the March 2016 quarter, and 2.1 per cent in the last year. Economists had forecast wages growth of 0.5 per cent and 2.2 per cent respectively. David Bassanese of BetaShares says the low wages growth contributed to the Reserve Bank’s decision to reduce the cash rate in May, adding that further easing of monetary policy is likely.

CORPORATES
AUSTRALIAN BUREAU OF STATISTICS, BETASHARES CAPITAL LIMITED, RESERVE BANK OF AUSTRALIA, UBS HOLDINGS PTY LTD, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB

$A jump dampens predictions of further rate cuts soon

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Original article by Jessica Sier
The Australian Financial Review – Page: 28 : 18-May-16

The minutes of the Reserve Bank of Australia’s May 2016 board meeting show that the central bank considered leaving rates on hold. The cash rate was cut by 25 basis points, but opinion among market watchers is divided as to the timing and extent of further monetary policy easing. Royal Bank of Canada’s Su-Lin Ong says the RBA could cut the cash rate again in June, although Capital Economics and the Commonwealth Bank expect a rate cut in August. The latter also expects another cut in November.

CORPORATES
RESERVE BANK OF AUSTRALIA, ROYAL BANK OF CANADA, CAPITAL ECONOMICS LIMITED, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, WESTPAC BANKING CORPORATION – ASX WBC

ANZ-Roy Morgan Australian Consumer Confidence unchanged at 113.9 after RBA rate cut and Federal Budget

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Original article by Roy Morgan Research
Market Research Update – Page: Online : 10-May-16

The ANZ-Roy Morgan Consumer Confidence rating for Australia remained unchanged at 113.9 in the week ended 8 May 2016. While the Reserve Bank’s cut to the official cash rate is likely to have been well received, any positive impact looks to have been somewhat offset by consumers’ reaction to the Commonwealth Budget. Consumers’ views towards their current personal finances fell 0.8 per cent, and consumers’ views toward the economic conditions in the next 12 months fell 1.2 per cent.

CORPORATES
ROY MORGAN RESEARCH LIMITED, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, RESERVE BANK OF AUSTRALIA

Volatile $A could hit US67c as further downside plays out

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Original article by Jessica Sier
The Australian Financial Review – Page: 26 : 10-May-16

Some currency experts have suggested that the recent sharp downturn in the value of the Australian dollar could continue. Mark Walton of BNP Paribas says the currency could fall to around $US0.67 if the Reserve Bank pursues further monetary policy easing. However, Robert Rennie of Westpac says the currency’s sell-off has been "rapid and unexpected", and he adds that it may find support from investors at around the $US0.73 to $US0.735 level.

CORPORATES
BNP PARIBAS SA, WESTPAC BANKING CORPORATION – ASX WBC, RESERVE BANK OF AUSTRALIA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, MOODY’S INVESTORS SERVICE INCORPORATED, FITCH RATINGS LIMITED, STANDARD AND POOR’S CORPORATION

Turnbull’s biggest economic landmines

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Original article by Jacob Greber
The Australian Financial Review – Page: 3 : 9-May-16

A number of factors may affect the election prospects of Prime Minister Malcolm Turnbull on 2 July 2016. The Reserve Bank holds its next monetary policy meeting on 7 June. While rating agencies are unlikely to downgrade Australia’s credit rating during the election campaign, Turnbull will be concerned about the possibility of Australia being placed on credit watch in the wake of the Budget. Economic data to be released during the 56-day campaign include the national accounts for the March quarter and jobs data for both May and June.

CORPORATES
AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, RESERVE BANK OF AUSTRALIA, MOODY’S INVESTORS SERVICE INCORPORATED, AUSTRALIAN LABOR PARTY, AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIA. DEPT OF FINANCE

Rates cut, fiscal plan keep real estate ticking

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Original article by Michael Bleby
The Australian Financial Review – Page: 6 : 5-May-16

Angus Raine, the executive chairman of Raine & Horne, says the Reserve Bank’s move to reduce the cash rate to 1.75 per cent should attract first-time buyers back to the property market. Most experts do not expect the rate cut and the Australian Government’s May 2016 Budget to have much impact on activity in the residential market, but some suggest that the new rules on superannuation fund balance transfers will prompt increased demand for lower-priced commercial properties.

CORPORATES
RAINE AND HORNE PTY LTD, RESERVE BANK OF AUSTRALIA, CBRE PTY LTD, CENTURY 21 REAL ESTATE, RAY WHITE REAL ESTATE, SECRET AGENT PROPERTY SERVICES

RBA says rate cut won’t boost house prices

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Original article by Su-Lin Tan
The Australian Financial Review – Page: 5 : 4-May-16

The Housing Industry Association has urged Australia’s major mortgage lenders to match the Reserve Bank’s 25 basis point reduction in the cash rate. Property industry experts say the new cash rate of 1.75 per cent will encourage first-home buyers to enter the property market, while LJ Hooker CEO Grant Harrod adds that it will bolster the housing markets of capital cities that are underperforming. The central bank does not expect the rate cut to significantly increase house prices.

CORPORATES
RESERVE BANK OF AUSTRALIA, HOUSING INDUSTRY ASSOCIATION LIMITED, LJ HOOKER (AUSTRALIA) PTY LTD, CORELOGIC AUSTRALIA PTY LTD, RP DATA LIMITED, RATECITY PTY LTD, FINDER.COM.AU, MORTGAGE CHOICE LIMITED – ASX MOC, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, THE REAL ESTATE INSTITUTE OF QUEENSLAND LIMITED

RBA delivers Turnbull a pre-election rate cut

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Original article by Vesna Poljak
The Australian Financial Review – Page: 1 & 4 : 4-May-16

The Australian sharemarket gained 2.1 per cent on 3 May 2016, after the Reserve Bank reduced the cash rate by 25 basis points to a record low of 1.75 per cent in the wake of a downturn in inflation. The ANZ Bank is the only "big four" bank that is yet to confirm that it will respond by reducing its mortgage interest rates. Meanwhile, Westpac and the Commonwealth Bank expect another official interest rate cut in August, although Goldman Sachs forecasts that rates will remain on hold until November.

CORPORATES
RESERVE BANK OF AUSTRALIA, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, WESTPAC BANKING CORPORATION – ASX WBC, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, GOLDMAN SACHS AND PARTNERS AUSTRALIA PTY LTD, STANDARD AND POOR’S ASX 200 INDEX, MACQUARIE GROUP LIMITED – ASX MQG, AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, AUSTRALIAN LABOR PARTY

Traders kiss goodbye to Aussie’s high hopes

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Original article by Stephen Cauchi
The Australian Financial Review – Page: 29 : 29-Apr-16

The Australian dollar has retreated from recent highs after the latest inflation data showed that the CPI fell by 0.2 per cent in the March 2016 quarter. Currency traders now do not expect the currency to test the $US0.80 level in the near-term, while the inflation data has also heightened expectations of further monetary policy easing. However, currency strategists are divided about the outlook for the dollar, with year-end forecasts ranging from $A0.70 to $A0.78.

CORPORATES
RESERVE BANK OF AUSTRALIA, WESTPAC BANKING CORPORATION – ASX WBC, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, HSBC AUSTRALIA HOLDINGS PTY LTD, MARKET ECONOMICS PTY LTD, CAPITAL ECONOMICS LIMITED, THINKFOREX