The Reserve Bank will start cutting official interest rates in March next year but, if the economy weakens, wholesale rates could move down sooner, according to Deutsche Bank.
Tuesday, June 7th 2005, 8:26AM
by The Landlord
Official interest rates would probably start falling in March next year and end up at 5.5 per cent by September, Deutsche Bank economists said.
Floating mortgage interest rates are about 9 per cent, but may come back to under 8 per cent late next year, based on the expected track for official interest rates.
The Reserve Bank is expected to leave the official cash rate at 6.75 per cent next Thursday, but Deutsche Bank warned that it would likely be the last chance to lift rates before the election.
The Reserve Bank faced an uphill battle to stop the market pricing an early start of the next easing cycle, Deutsche Bank said.
