But wait there's more still !!! (MC)
Reply: 1.1.1.1
From: Anonymous
Interest rate cut expected
From AAP
04dec01
A BOUYANT housing industry will help Australia weather the world economic storm but homeowners can still expect a pre-Christmas dose of interest rate relief.
The Reserve Bank of Australia (RBA) board met today for the last time this year and is widely tipped to announce a 0.25 percentage point cut tomorrow morning after leaving rates on hold during the election campaign.
The cut would be the sixth this year and give mortgage holders an extra $22 a month to spend over the holiday season, based on an average $150,000, 20-year mortgage.
If the RBA defies expectations and opts for a larger half a percentage point cut, the savings would be $43 a month.
Economists said the existing historic low interest rates had helped fuel a higher-than-expected 1.8 per cent rise in building approvals in October, seasonally adjusted.
The 15,294 houses and units approved for construction was a 56.5 per cent improvement on the same time last year and came after a stumble in the housing recovery in September, when approvals dropped 4.3 per cent.
The Housing Industry Association said pent-up demand would keep builders humming along for another six months.
But the Master Builders Association warned building approvals may have peaked and said another rate cut would support the industry without fuelling a housing boom.
"Another cut in interest rates should maintain homebuyers' confidence and help sustain the new housing market over the next 12 months," chief economist Wilhelm Harnisch said.
The latest survey of industrial trends from Westpac and the Australian Chamber of Commerce and Industry (ACCI) painted a mixed picture of the economic outlook.
The survey, done just after the federal election, showed manufacturing activity strengthened in the December quarter, with 75 per cent of businesses working at or above their normal levels, a seven-year high.
But business confidence dipped dramatically, with the number of businesses expecting an improvement in the economic climate over the next six months halving to 15 per cent.
The number bracing for a downturn doubled to 39 per cent.
Westpac economics general manager Bill Evans said it was the first time the survey had shown such a split between activity and expectations, and he put it down to the global economic uncertainty.
He said the doubtful outlook meant the RBA would opt for a modest rate cut.
"They'll cut by a quarter of a per cent, they'll withstand any temptation to go by the full half per cent and that is consistent with what we are seeing in the survey," he said.
ACCI chief executive Mark Paterson said the building industry was the only bright spot on the horizon over the next six months, with sales and production both expected to fall.