Via the SMH blog:
Goldman Sachs economist Tim Toohey has boldly stuck to his call for a further RBA rate cut as the consensus shifted overwhelmingly to on hold.
In light of new consumer confidence figures, which increased only slightly, Toohey asks how much longer can the RBA afford to wait before it cuts rates?
“Only last week the Governor reminded markets that the RBA “still has plenty of ammunition on interest rates” and appeared to set up the August Statement on Monetary Policy as a key point in the evolution of RBA policy. With consumer sentiment clearly in the RBA’s “rate cutting zone”, we would not be surprised to see the RBA use the SMP to shift to an easing bias – followed by a subsequent rate cut in September 2014,” he says.
Couldn’t have put that better myself, though I’m backing October after lousy Q2 national accounts.
