Christmas rate cut on the cards
Leading online bookmaker sportsbet.com.au reports a dramatic shift in betting over the weekend on next month’s RBA interest rate decision which points strongly to another cut.
“The odds for an interest rate cut of 25 basis points in December was $2.30 on Friday and has now been sensationally backed into $1.65,” sportsbet.com.au’s Haydn Lane said.
“On the flipside, the price for rates to remain on hold have ballooned out from $1.57 to $2.50.
“The money suggests there’s also a chance of a larger move, with odds of a 50 basis points rate cut halving over the weekend from $10 into just $5.00.”
Just over $100,000 has been wagered on the market so far this month, with a peak of betting likely to spike next Monday on the eve of the announcement.
“Our betting markets have proven to be a great predictor of RBA announcements over time, so it looks like mortgage holders are in for some welcome news next week,” sportsbet.com.au’s Haydn Lane said.December RBA Interest Rates Announcement (prices from Friday, 25 November in brackets)
- $1.65 – Decrease between 1 and 25 basis points (in from $2.30)
- $2.50 – Rates to stay the same (out from $1.57)
- $5.00 – Decrease between 26 and 50 basis points (in from $10)
- $15 – Decrease 51 basis points or more (steady)
- $101 – Any increase (steady)