ANZ Economist
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What recent changes have occurred with the RBA's interest rates?
It's the Real Estate Podcast, brought to you by ANZ Home Loans for financial well-beings. And welcome to another episode of the Real Estate Podcast, available on iHeartRadio every morning at 6.30, also available on Spotify and Apple and wherever you get your podcast from. It is a Thursday morning. The week has just, it's gone by pretty fast for us here at the Real Estate Podcast. It is already the 6th day of October nearly a week into October and next month of course is November and I guess now is the time to start thinking about booking that holiday away if you leave it too late nothing will be available and you'll be fiddling with your thumbs at Christmas time that's of course if you are lucky enough to be heading away for a bit of a break after 2022
After Tuesday's rate hike, more and more people are digging in for the long haul because this inflation problem is not a sprint but rather a marathon and household budgets are going to be tested well and truly into 2023. And talking of tested, coming up next, we're going to be speaking with Adelaide Timbrell, ANZ Senior Economist.
What does the latest RBA rate hike signal for future increases?
We're going to be having a look at this interest rate rise. And the RBA has signalled that it expects two more rate increases in this tightening cycle. We'll be asking Adelaide what she thinks about That means, because of course we still have two more months coming up in this year, and what sort of rate rises are we going to expect? Hey, if you're celebrating your birthday today for the 6th of October, Shu, you're sharing it with her. She is the American actor turning 58 today. Tony Gregg, he would have been celebrating his birthday today, but he died unfortunately back in 2012. So if you are celebrating your birthday, have a fantastic Thursday. It's your real estate podcast for breakfast. It's the main centre forecast with PRD, selling smarter every day.
All right, let's check on your weather for this Thursday morning. Good morning to you in Sydney, expecting a high of 21 degrees and the rainy bits today. Melbourne expecting showers to increase in 22 degrees, so the temperature is good. In Brisbane, expecting one or two showers with 22.
How many more rate rises are expected before the end of the year?
And in Perth today, partly cloudy, but it's not raining, expecting dry conditions and a high of 19 degrees. It's your weekday real estate breakfast with news, interviews and predictions every morning on The Real Estate Podcast. Let's bring in Adelaide Timbrell. She is the ANZ Senior Economist there. And a very good morning, Adelaide. Welcome to the Real Estate Breakfast. Thank you. Good morning. So how much of a surprise was Tuesday's announcement in terms of going 25 instead of 50? I think what the Reserve Bank has been saying over the past few months is that they will eventually have to refine their cash rate increases. And certainly about a month ago, they did signal that as the cash rate increases, the argument for smaller cash rate increases from the higher rate become more likely.
So it's not a shock, but we were expecting the Reserve Bank to increase the cash rate just one more time in October by 0.5 percentage points. So it was not the base case scenario for us that they would lift 25, though it was an option.
What factors are influencing the current inflation rates?
Yes, so a lot of economists, as you say, were predicting that 50 basis points. So what does that mean sort of moving forward? Yesterday I said that if you bring it down to 25, surely the next increase isn't going to jump back up to 50. That's exactly right. And I think when we take a step back and look at the bigger picture, the biggest signal that the RBA has given us with this 25 basis point hike is that there is a very small chance of another 50 basis point hike from here. The Reserve Bank has been hiking the cash rate extremely quickly. In fact, the last time we saw the cash rate going up, it took about five years to get that two and a half percentage point increase that we've seen in the space of about five months so they've been going really quickly they've started to slow down now we think it's more likely that we'll only see 25 basis point hikes from here including one in November.
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Chapters
7 chapters
1
What recent changes have occurred with the RBA's interest rates?
0:02–1:24
2
What does the latest RBA rate hike signal for future increases?
1:24–2:42
3
How many more rate rises are expected before the end of the year?
2:42–3:57
4
What factors are influencing the current inflation rates?
3:57–5:27
5
How do savings and fixed mortgages affect the impact of rate hikes?
5:27–7:13
6
What is the current state of mortgage defaults in Australia?
7:13–9:06
7
How does negative equity compare to previous years in Australia?
9:06–10:39
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