Dear %%first_name%%,
The Reserve Bank’s interest rate cut on Tuesday was welcomed by the market, but the decision comes ahead of a predicted slowdown in mining. Where should we invest in a post-mining boom Australia? We take a look at the future in today’s report.
JP Goldman delves into the companies and sectors that will benefit from lower interest rates in the years ahead, while I take a look at what to expect from the markets in the final quarter of this year. We also have a special guest for you this week – futurist Craig Rispin. It’s his job to identify the new investment trends and he names them in the first of a special series for the Switzer Super Report. We hope you enjoy this edition.
Sincerely,
Peter Switzer
ANZ has given its mortgage holders no reason to expect it will pass on the Reserve Bank of Australia’s (RBA) interest rate cut, saying the cash rate has no effect on its funding costs.
None of the four major banks have reduced their variable home loan interest rates since Tuesday’s 25 basis point cut by the RBA, which took the cash rate 3.25 per cent, it’s lowest level in three years.
ANZ Australia chief executive Philip Chronican said the bank would stick to its 10-month old process of setting lending rates on the second Friday of each month.
“Our cost of funds doesn’t change on the first Tuesday of the month when the Reserve Bank moves its cash rate, we fund ourselves through a range of term deposits or even wholesale funds,” Mr Chronican told reporters on Thursday.
“We’re trying to create a gap between the Reserve Bank’s move.
“Sometimes when the Reserve Bank moves its cash rate down, long term rates go up, sometimes long term rates go down.
“We want to give the market time to settle and see how our rate structure works.
“We felt it appropriate to be able to look at the full range of funding costs when we made our decision and the best time to do that was with the lag after the Reserve.”
Bank of Queensland is the only significant lender to have moved since Tuesday, reducing its home loan interest rates by 20 basis points.
-- AAP