Market pricing update
Only in December was the Reserve Bank expecting the next move in rates to be up, but tightness in credit flows and falling housing prices have had far-reaching impacts on consumption and with construction to follow.
Not much help has been forthcoming from fiscal measures.
Meanwhile a number of lenders are tightening their mortgage lending assessment criteria even further with regards to credit card facilities, expenses, and other assessment variables.
One prospective but hapless borrower had a $1.19 outstanding bill questioned this week, eclipsing the $3.50 query I encountered a few days earlier. Crazy times.
Meanwhile bond yields continue to get punched down to fresh record lows.
Can't swear on the blog as it bounces subscriber emails, but markets appear to be pricing the risk of things turning into a bit of a fustercluck.
Terry McCrann at the Herald Sun has just reported that an interest rate cut in June is now certain, and that the four big banks will pass on the cut in full on variable mortgage rates.
According to McCrann on the newswires a second cut will not automatically follow in July, pending further unemployment readings.
