Good afternoon all
One of the most pressing questions at this time every month is…will the RBA raise interest rates?
Whether it does or does not will be revealed next Tuesday. However notwithstanding the RBA’s decision, I believe there is a far more pressing question: will the banks raise interest rates independent of the RBA?
For what it’s worth AND it’s only my opinion, I don’t believe the RBA will raise rates next week. I’m convinced there are very good reasons not to do so including a manageable rate of inflation and reasonable unemployment numbers. However there is a much more important reason to (at least) postpone any rate rise; and that is (as the infamous John Laws once…or twice said), those folks in ‘struggle-street’ are really struggling.
I get around a bit and speak with both business people and investors AND I can tell you many are struggling to survive, let alone grow their businesses and/or investment portfolios.
Regarding the far more pressing question mentioned above, unfortunately I have a very uncomfortable ‘gut-feeling’ that the banks are about to move rates up. And this contention is gathering momentum. Commonwealth Bank CEO Ralph Norris, at its annual general meeting, highlighted the increasing costs of funding…usually a clear indication that a decision has already been made. This also signals to other financial institutions that a rate rise is in the wind.
What's your opinion?
Cheers
Garry
One of the most pressing questions at this time every month is…will the RBA raise interest rates?
Whether it does or does not will be revealed next Tuesday. However notwithstanding the RBA’s decision, I believe there is a far more pressing question: will the banks raise interest rates independent of the RBA?
For what it’s worth AND it’s only my opinion, I don’t believe the RBA will raise rates next week. I’m convinced there are very good reasons not to do so including a manageable rate of inflation and reasonable unemployment numbers. However there is a much more important reason to (at least) postpone any rate rise; and that is (as the infamous John Laws once…or twice said), those folks in ‘struggle-street’ are really struggling.
I get around a bit and speak with both business people and investors AND I can tell you many are struggling to survive, let alone grow their businesses and/or investment portfolios.
Regarding the far more pressing question mentioned above, unfortunately I have a very uncomfortable ‘gut-feeling’ that the banks are about to move rates up. And this contention is gathering momentum. Commonwealth Bank CEO Ralph Norris, at its annual general meeting, highlighted the increasing costs of funding…usually a clear indication that a decision has already been made. This also signals to other financial institutions that a rate rise is in the wind.
What's your opinion?
Cheers
Garry