The Finder’s RBA Cash Rate survey found the general consensus among economists and finance experts was that the next cut would take place in February.
All 38 respondents agreed the November meeting, to be held later today, will see the central bank hold the current historic low rate of 0.75 per cent.
However, the successive cuts appeared to have had little impact on the Australian economy.
“We’ve seen multiple references to the RBA firing blanks with these cuts and running out of bullets in the process,” said Graham Cooke, insights manager at Finder.
“If true, it’s hard to believe that flogging the same horse will produce a different outcome.”
The next cut would see the cash rate drop to 0.50 per cent, but it is unlikely that the RBA would venture into negative rate territory.
“The RBA has not spoken fondly about negative interest rates in other countries, so I’d expect extra cash to be printed before we see a zero or subzero cash rate,” Mr Cooke said.
Experts and economists in the survey predicted a hold for today, with the RBA likely wanting to assess the impact of their previous rate cuts before proceeding with more.
September labour figures were likely to have come as some relief to the RBA, but the Consumer Price Index is running below expectations and could fuel another cut in the medium term.
The survey also found that more than half of consumers believed there would be a recession in the next 12 months, compared to just 9 per cent of experts and economists. More than half of experts and economists think that households are cutting back on spending for fear of recession.
“While slow wage growth and underemployment seem like cause for concern for consumers, Australian economists can see the light at the end of the tunnel,” said Mr Cooke.
“Market behaviour is hugely driven by psychology and we need to be careful not to talk ourselves into a recession.”
