Pete Wargent blogspot

Co-founder & CEO of AllenWargent property buyer's agents, offices in Brisbane (Riverside) & Sydney (Martin Place), and CEO of WargentAdvisory (providing subscription analysis, reports & services to institutional clients).

4 x finance/investment author - 'Get a Financial Grip: a simple plan for financial freedom’ (2012) rated Top 10 finance books by Money Magazine & Dymocks.

"Unfortunately so much commentary is self-serving or sensationalist. Pete Wargent shines through with his clear, sober & dispassionate analysis of the housing market, which is so valuable. Pete drills into the facts & unlocks the details that others gloss over in their rush to get a headline. On housing Pete is a must read, must follow - he is one of the better property analysts in Australia" - Stephen Koukoulas, MD of Market Economics, former Senior Economics Adviser to Prime Minister Gillard.

"Pete Wargent is one of Australia's brightest financial minds - a must-follow for articulate, accurate & in-depth analysis." - David Scutt, Business Insider, leading Australian market analyst.

"I've been investing for over 40 years & read nearly every investment book ever written yet I still learned new concepts in his books. Pete Wargent is one of Australia's finest young financial commentators." - Michael Yardney, Australia's leading property expert, Amazon #1 best-selling author.

"The most knowledgeable person on Aussie real estate markets - Pete's work is great, loads of good data and charts, the most comprehensive analyst I follow in Australia. If you follow Australia, follow Pete Wargent" - Jonathan Tepper, Variant Perception, Global Macroeconomic Research, and author of the New York Times bestsellers 'End Game' and 'Code Red'.

"Pete's daily analysis is unputdownable" - Dr. Chris Caton, Chief Economist, BT Financial.

Tuesday, 29 January 2013

Rate cut off the table for February meeting

I blogged the other day on how I felt the odds of a rate cut seemed to be priced far too high by the interbank lending rates.

I said I would take a straight punt on rates being on hold in February, for there just don't seem to be enough drivers at this juncture for further immediate easing action.

The stockmarket is roaring, iron ore is resilient, the dollar has calmed down a bit, property prices appear to be firm enough. Did I mention stocks are up 20% in 6 months? I think I did.

The futures markets have slowly caught on to this.

The ASX 30 Day Interbank Cash Rate Futures February contract is now trading at 97.055, indicating only a 27% expectation of a rate decrease to 2.75% at the next RBA Board Meeting.

In other words, the odds are very low, but a small margin is retained to reflect the potential for shock news over the next week.

The market implies a reasonable each-way chance of a cut in March.