Banks will not pass on rate cuts in full

Advertisement

The pressure is on from the property adoring press:

Experts expect the major banks to pass on most, if not all, of a one-quarter of a percentage point drop in the official cash rate to 1.25 per cent at Tuesday’s meeting, which financial markets estimate is an 86 per cent chance.

“They should pass it through,” said Jason Kururangi, a portfolio manager at Aberdeen Standard Investments. “I think that their licence to operate has probably come into question in the last few years.”

The full text of this article is available to MacroBusiness subscribers

$1 for your first month, then:
Cancel at any time through our billing provider, Stripe
About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.