News Headline Summary

RBA watcher McCrann writes: "Rate cut likely next week, and here's why"

THE Reserve Bank will probably cut its official interest rate next week. That will take it back to the historic low-point of 3 per cent.

Another 25 points off the official rate - perhaps 20 points off most home loan rates, but also it is very important to emphasise, 20-25 points off rates on deposits which also are key to spending, as well, is not going to unleash a spending binge.

Yes, it would probably give the critical three weeks to Christmas and the two weeks through the new year a boost.

But it's not going to miraculously save the retail industry from its much more fundamental and much more intractable structural problems.

Read more: http://www.news.com.au/business/rate-cut-likely-next-week-and-heres-why/story-e6frfm1i-1226526101503#ixzz2DYVqQieu

28 Nov 2012 - 21:33 - Important - Source: news.com.au

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