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ISCOVER
Staff Reporter
A majority of borrowers expect the Reserve Bank to cut the official cash rate again before the end of the year.
According to a new poll conducted by Loan Market Group, 64 per cent of home owners believe there will be another rate cut within the next few months.
Loan Market corporate spokesman Paul Smith said 46 per cent of respondents thought rates will drop by 25 basis points, 15 per cent expect rates to fall 50 basis points while three per cent predicted a cut of more than one percentage point.
Mr Smith said 36 per cent of the 865 online poll respondents said there will be no reduction in the current official rate of 3.5 per cent.
“Although many economic forecasters are tipping the RBA to stay on the sidelines, the consumer sentiment is clearly in favour of further rate relief,” Mr Smith said.
He said the 75 basis points reduction in the cash rate over May and June had been beneficial, but a cloud remained over the housing and retail sectors.
“The RBA has been keeping rate cuts in reserve in the event of any deterioration of the domestic economy or more bad news from Europe,” he said.
“But consumers would clearly like another helping hand from the RBA and rate relief could provide a welcome boost to their confidence in the lead up to Christmas.”
