TWEET TALK: Rates recess

Experts in the Twittersphere largely agree interest rates won't budge today, while an overvalued dollar and transitioning mining sector have played into predictions on future moves.

Tweet Talk takes the best of Twitter and brings it to you. Today, economists weigh in on the move they think the RBA will make on interest rates for March.

An AAP survey of 13 economists today resulted in a unanimous prediction that the Reserve Bank would vote not to touch the official cash rate when it meets at 1430 AEDT today.

Experts have largely echoed this view in the Twittersphere, with the high Australian dollar and signs previous cuts are working leading some to suggest the rate-cutting cycle was over.

Rates have remained at an all-time low of 3 per cent since a cut of 25 basis points in December, equal to the lowest rate during the global financial crisis in 2009.

Head of investment strategy and chief economist at AMP Capital Shane Oliver (@ShaneOliverAMP) said the bank would leave rates untouched because the economy had yet to feel the full effects of past cuts.

"On hold from RBA today. RBA can site further signs of rate cuts getting traction & impact of past rate cuts still in pipeline," he tweeted.

But the high Australian dollar and a resources sector in flux were also mentioned by analysts.

Treasury dealer at the Arab Bank of Australia David Scutt (@David_Scutt) tweeted that "Given the #rba believe the #AUD is slightly overvalued, it's likely they'll keep a #dovish tone to keep its gains in check..."

University of Western Sydney Associate Professor of Economics & Finance Steve Keen (@ProfSteveKeen), however, cited the high dollar as reason for a possible cut.

"Probably on hold...but they may surprise with a cut. If a cut--finally accepting carry trade cause for overvalued dollar," he tweeted. Any further cuts today would bring the cash rate to the lowest in Australia's history.

In contrast, OptionsXpress market analyst Ben Le Brun (@benlebrun) suggested we may see a reversal of the bank's easing measures in the coming months.

"I think theyll hold & that we have see the end of the cutting cycle due 2 confidence returning at home & abroad. 3.5% in 1 yr," he tweeted.

Eureka Report investment strategist Adam Carr (@AdamCarrEcon) conferred.

"The expectation was that the mining boom would peak this year...Last weeks CAPEX data shows this not the expectation of miners...so we should, in theory, see the board revise up its view," he tweeted.

Meanwhile, David Scutt agreed "the easing cycle is now complete", but he also warned "If #rba drop the easing bias it'll put a rocket under the #AUD, something an economy transitioning from the #miningboom doesn't need #ausbiz.

"#RBA statement will read neutral until the final paragraph. They'll keep the easing bias, if only to keep the #AUD in check."

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