1. Safety net shunned for investor protection
  2. Budget tax win over losses
  3. Spain tumbles back into recession
  4. Two-speed economy to widen
  5. Slower inflation gives RBA room for a 25-point cut, say economists
  6. IMF warns resource prices on way down
  7. Investment boom 'at peak'
  8. China manufacturing posts another monthly gain
  9. Bernanke flags continued low rates to boost jobs
  10. Retail investors the key to $40bn growth
  11. Apple taps cash stash for investor payout
  12. IMF chief cautiously upbeat on global economy
  13. Signs of Europe recovery offset by China weakness: OECD
  14. Greece closes critical debt deal with creditors
  15. ANZ expands in China with local currency products
  16. Less gold mined last year, but it was worth more
  17. Woolies to invest $2bn
  18. Coles to put hotels on the block
  19. Telstra signs up for NBN fibre-optic superhighway
  20. Interest rates where they should be: RBA
  21. Costco's $140m stores plan
  22. Banks face dividend hit, says Westpac as funding crunch threatens payouts
  23. Obama backs Buffet rule, higher taxes on oil industry and private equity
  24. Cautious economists tip US economy to surprise on upside
  25. Greeks seal fresh austerity deal, eurozone ministers mull debt restructure
  26. IMF shaves growth estimates for China from 9pc to 8.25pc
  27. A coin toss, but RBA likely to cut rates
  28. Retail sales drop 0.1pc in December: ABS
  29. Westpac CEO Kelly defends job cuts, refuses to comment on passing on rate cuts
  30. ANZ treasurer sees positive signs in eurozone despite funding troubles
  31. First-half results for some sectors tipped to be a bloodbath
  32. Woodside kicks off $1bn Browse sale as plans for processing plant may be axed
  33. 35,000 jobs at risk as advice reforms bite
  34. Finance sector faces big squeeze with low credit growth and high dollar
  35. Deadlocked Greek debt negotiations threaten to delay key bailout talks
  36. Beijing to stimulate economy as growth heads below 9pc
  37. ECB president Mario Draghi more upbeat as holds rates
  38. Merkel, Sarkozy up pressure on Greece, agree to push financial transaction tax
  39. Retailers made to work hard for the money by post-Christmas shoppers
  40. Manufacturing expands in December despite weak demand
  41. ECB pledge to help banks as funding pressures rise
  42. Europe crisis to hit home as liquidity dries up, says Wesfarmers
  43. JB Hi-Fi warns of earnings slump
  44. Euro banks on brink in funding crisis as collateral crunch threatens system
  45. Europe banks face $150bn capital shortfall
  46. Standard and Poor's warns of mass eurozone downgrades
  47. Rate prospects unclear as euro rescue develops
  48. CBA, Macquarie say Standard and Poor's downgrade won't affect funding
  49. Fitch lowers outlook on US to negative, affirms triple-A status
  50. Telstra chief overhauls Telstra for NBN game
  51. Leaders must 'hurry up' and solve Europe crisis: RBA's Stevens
  52. Hopes fade for US supercommittee deal on deficit reductions
  53. Risks of global recession mount
  54. U.S. Banks Face Contagion Risk From Europe Debt
  55. Greece Starts Talks With Banks on Debt Swap
  56. BHP's shale gas payoff
  57. Branded wines 'hard pressed'
  58. EU warns of recession through 2012
  59. Italian bonds hit record as Berlusconi fights for survival
  60. Emissions: who comes clean?

Punters set to win with Cup day interest rate cut

October 11, 2011

ECONOMISTS are becoming increasingly confident the Reserve Bank of Australia will cut interest rates on Melbourne Cup Day, in a bid to stop the economy from stalling and unemployment climbing.

ANZ has forecast that the official cash rate will be slashed by 25 basis points to 4.5 per cent at the November meeting in three weeks.

The bank believes the RBA will then remain on hold until early next year before cutting rates again.

The forecast came after the RBA last week flagged that an interest rate cut could be ordered and the ANZ job advertisement series, published yesterday, showed a 2.1 per cent decline in job position vacancies.

The number of job advertisement, online and in newspapers, is just 3.1 per cent above the same level last year.

The number of vacant jobs in Australia has been falling as the official unemployment rate increased to 5.3 per cent.

ANZ's head of Australian economics, Ivan Colhoun, said the RBA was likely to cut rates to help safeguard the economy against the slower global growth as a result of the European debt crisis.

"There is scope for the RBA to reduce interest rates a little as insurance against weaker than expected growth and even higher unemployment," he said.

"We expect the first of two 25-basis-points cuts are likely to be enacted at the next board meeting in November.

"This would be a prudent move given global uncertainties and downward revisions to global growth forecasts."

Mr Colhoun said two rate cuts over the next four to six months would protect the economy, but warned that deeper reductions could be ordered if the European crisis was not solved and created damaging global consequences.

Westpac has forecast that rates could be cut by up to 100 basis points over the next year.

NAB predicts rates will remain at 4.75 per cent for "some time ahead", while it is understood CBA could be in the process of reviewing its cash rate forecast.

The interbank futures market is convinced that the RBA will aggressively slash rates, starting next month. The likelihood of a Cup Day rate cut is 1345 per cent -- a more than certain prospect.

It also forecasts that the official cash rate will be 137 basis points lower by this time next year.

A Cup Day cut would be the first time the RBA has reduced interest rates since April 2009, when it was managing the fallout of the global financial crisis.

Article by Scott Murdoch From:The Australian