by Glenn Baker

The Reserve Bank Board again opted for stable interest rates when it left the official cash rate unchanged at 4.75 per cent at its April meeting. This is the fourth meeting in a row at which it has maintained a steady cash rate.

The immediate outlook for interest rates is for a continuation of a 'no change' approach by the Reserve Bank. As we move deeper into 2011, however, it is expected that developments in the economy will necessitate a return to a mild tightening of monetary policy that would see interest rates raised again in the latter part of the year in order to contain the emergence of a higher level of inflation.

by Peter Switzer

Is this just me, or are we copping a lot of baloney about interest rates from banking economists and/or the media? It seems that there are some with hidden agendas, or they are simply boofheads not knowing what damage they’re doing by constantly warning interest rates are to rise.

And it seems to me that either some people are a bit miffed that their warnings are not coming to fruition, underlining their questionable predictive powers, or as I have suggested, they are simply boofheads.

The negative headline

Oh yes, there can be another reason and it’s linked to the media’s need to attract eyes to websites and coins to newspapers – the curse of the populace’s need for a negative headline!

by Peter Switzer

I know you often hear me rabbiting on about the Reserve Bank and interest rate rises but I’m not the only one!

Sure what follows is less aggressive than the barbs I throw at the RBA but given the conclusion by the smart guys and girls at Morgan Stanley Smith Barney, it effectively says the Big Bank has gone too hard, too fast, too early.

In a brief for private clients, the US-owned investment bank says looking at what is happening to economic data and the high levels of interest rates for personal loans and small business loans the next rate move might be down!