15 January
Goldman Sachs now expects RBA rate cut in May instead of April
Economists at Goldman Sachs Group Inc. have moved the expected date of the next interest rate cut in Australia from the upcoming week to May. The experts cited uncertainty in the country's domestic politics as well as the outlook for global trade.
Goldman Sachs' revised forecast is now in line with the assumptions of most other analysts. They expect the Reserve Bank of Australia (RBA) to leave its key rate unchanged at 4.1% next Tuesday. Last month, the regulator cut borrowing costs for the first time in four years.
Such forecasts are mainly associated with the upcoming elections in the country on May 3. As Andrew Boak, Goldman's chief economist for Australia, notes, a pause at the April 1 meeting will give the RBA a chance to assess the government's future fiscal policy, depending on which party wins.
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