Australia’s economists are split on whether the next move in interest rates will be higher or lower over the next 12 months.
According to forecasts offered to Bloomberg, only 12 of the 22 economists surveyed see the cash rate sitting at its current level of 1.5% in the June quarter of next year.
Of the remaining 10 forecasters, seven see the cash rate higher by this time next year, while three see it lower.
Those in the rate cut camp include RBC Capital Markets, Nomura Australia and JP Morgan, the latter the most dovish of the trio forecasting that the cash rate will be cut not once by twice.
On the other side of the fence, Barclays, Bank of America-Merrill Lynch, Forecast Singapore, HSBC, Laminar Capital and TD Securities all have one hike pencilled in, while Societe General, at two, is currently the most hawkish forecaster.
Australia’s big four banks — the CBA, Westpac, ANZ and the NAB — all have the cash rate remaining at 1.5%.
The split in Australia’s economic community mirrors that seen in financial markets, with rates traders pricing in a small chance of another rate cut this year before switching to a small possibility of a hike over the next 12 months.
Business Insider Emails & Alerts
Site highlights each day to your inbox.