On balance the data does not spell out a strong case for a rate rise in March. Strong housing loan growth might tip them into hiking but it is very difficult to call. If the RBA doesn’t hike this month then it will almost certainly do so in April. We expect the cash rate to be 4.5 per cent by the end of the year.
JAMES KNIGHTLEY | ING
In what is viewed as a very tight call between no change and a 25 basis points hike, we look for the RBA to opt for the latter. Credit data could yet swing the decision, but other news has been positive. We presume that China’s second reserve ratio hike within a month will not prevent the RBA from moving.
DOMINIC BRYANT | BNP PARIBAS
The RBA estimates that the effective cash rate is actually closer to 4.75 per cent. This is below normal but not especially loose, hence the RBA’s belief that it can bide its time. On that basis we expect a further a pause at the March meeting. But it is a close call and only a matter of time before the next hike.