RBS: 100% chance of April rate cut

From Forexlive, OIS is pricing 74% chance of cut in April but RBS says 100%:

“We agree that there is little reason for the RBA to wait…However, we doubt the RBA will rush to cut rates after April and it may not need to if the AUD falls as we expect it to against a stronger USD. We are at least watchful of divergence with Chinese capital markets, but perhaps the AUD is a better guide to conditions in China,” RBS argues.

“We continue to see the AUD falling towards 0.65 this year in the context of weaker commodity prices and a stronger USD,” RBS projects.

With the iron ore crash now entering capitulation I agree.


  1. reusachtigeMEMBER

    That is so cool and is such a great signal telling us to max out on more investment properties. Life for us has never been better and will keep getting better of course because we investors are the chosen ones! LOLOLOL!!!

    • Yes wonderful news. These crasniks don’t realise that this is what keeps our party going. Why would property cash when you get negative returns for sitting on the sidelines. Getting into the game and the sex appeal that goes with it is the rational thing to do.

      Bubble bursting?


      • I’ve gotten 20%+ returns in the last year by sitting on the sidelines… however, my sidelines are not in AUD. More and more people will catch onto this; especially foreign investors.

        House prices to the moon! AUD to the floor! Banana repubic, here we come!

    • It’s obvious the RBA are picking winners despite the rhetoric, if you are not in property you’re a born loser, that’s the message RBA sells.

      • reusachtigeMEMBER

        Yes, and such a true message! It’s good to see that more and more people are hearing it and maxing out to get on board.

      • … property or offshore investments… let’s see how that message goes down. Ha ha!

  2. fitzroyMEMBER

    I think I am seeing the beginning of a credit crunch on the street in Melbourne

  3. “We agree that there is little reason for the RBA to wait…”
    That’s nice, thanks for sharing that. So why slash again? What will that achieve? Oh… I see… It’s just what you do.

      • Indeed. The RBA slashing brings the scenario of AU and US interest rates crossing, after which I will be able to waltz into Oz with my pile of USD and buy my compound in Elizabeth with the 10 foot steel plate fences and razor wire, and live out my Mad Max dream.


    “Lucy, Glenn here, can you hold the fort this afternoon?” I’m due to meet with those Euro bankers who’ve just flown in urgently on their ACJ318s to discuss the RBA policies.”

    “As you know, I’m doing all I can to protect the integrity of our nation’s economy, and what they’re after is not fair dinkum. So, we’ve agreed to have a deciding game of chess to determine who prevails.”

    “Evidently, they assure me, it’s how they do things and many big decisions are resolved this way in the Parc du Cinquantenaire in Brussels.

    “They let me know I’ll be up against a Magnus Carlsen (their top player) but they don’t know I was Captain of my High School chess club.” I plan to give him a ‘hiding’ over in Hyde Park.” “Back in a tick.”

    • I thought this to be so probable that I was going to ask you to source the information.
      Then I thought, nah…more likely they’re playing snap…