Australian interest rates

MSM idiot one: Financial markets are all but ruling out any further interest rate cuts from the Reserve Bank of Australia as the world’s most powerful central bank, the US Federal Reserve, tips it will be lifting rates three times during next year.

More or less, via the AFR: Australian households are overgeared and the Reserve Bank of Australia might have to cut interest rates up to three times to ward off a dramatic deleveraging event in the economy.

The Fed has unleashed global bond carnage this morning as yields move to reprice rate hikes.

From the AFR comes loony money: Real estate financier Qualitas, backed by Carol and Alan Schwartz, has seeded a start-up that allows small investors to offer home loans to Asian buyers shunned by the major banks.

From The Australian: Commonwealth Bank has shadowed its peers in raising investor interest rates, with the move coming through a strong out-of-rate hike cycle that has largely targeted property investors.

From Banking Day: Yields in money markets range from stable to rock solid, a factor proving to be of lesser importance amid an out-of-cycle hike on variable rates on home loans.

From the always worthwhile Vimal Gor at BT: There can be no doubt that Trump’s victory will be game changing geopolitically as it will alter the course of established diplomacy.

From Macquarie:  The 3Q GDP outcome will come as a shock.

From Bill Evans at Westpac: As expected the Reserve Bank Board decided to leave the cash rate unchanged at 1.50%.

No surprise.

From the Shadow: The course of the world’s largest economy has become less certain with Donald Trump unexpectedly triumphing in the US Presidential election.

From Domainfax: Westpac is lifting variable interest rates on new and existing interest-only home loans, the bank has confirmed.

From the AFR: Commonwealth Bank of Australia, the nation’s largest lender, is increasing rates on fixed term owner occupied and investment loans by up to 65 basis points, the latest of the majors to respond to rising international funding costs caused by the ‘Trump effect’, tougher underwriting standards and tighter rules.

From Westpac’s Bill Evans: The Reserve Bank Board meets next week on December 6.

Chris Bowen is talking it up, or is that down, at the AFR: Shadow treasurer Chris Bowen will on Wednesday outline the bleak scenario facing the nation’s banks and heavily indebted households if the AAA credit rating is lost, and blame the Turnbull government for exploding federal debt by $4500 a person in Australia.

From the usually pretty good James Aitken via the AFR: The rout in the bond market that was set in motion well before November 8, Aitken says, has further to go; as does the rotation out of bonds, and bond-like stocks, into stocks.

So say the OECD, via the AFR: The Reserve Bank of Australia is being urged by the Organisation for Economic Co-operation and Development to prepare the nation for official interest rate increases in 2017 to avoid a housing market blowout.

The Aussie bond selloff is still going great guns this morning with yields breaking out to new highs across the curve: Unlike the US, the curve is still steepening here too as the bulk bubble persists: With the two year at 1.89bps it is now tilting towards two rates hikes through 2018 now.

From the AFR: Lenders are raising the cost of buying property by up to 60 basis points as the impact of the ‘Trump effect’ and growing expectation that central bankers are set to end the era of record low rates ripples through global markets.

From the RBA’s Christopher Kent: I am grateful for the opportunity to address you all this evening.

The Aussie “bondcano” has stalled: Not so the US with short end yields right at the verge of a breakout to new highs on daily charts.

Via The Australian: Goldman Sachs has upgraded its Australian dollar and economic growth forecasts.

Still more of a whimper than a bang.

Wrong: Rising fixed mortgage rates mean it could be time to lock in record low repayments before it is too late, say mortgage specialists and financial analysts.

Because it appears to be coming for the simplest of reasons: jobs.