Strong majority of economists tip December RBA cash rate cut: Bloomberg

Sentiment has turned strongly in favour of a December 4 RBA cash rate cut.

Of the 28 economists surveyed today by Bloomberg, 19 are tipping the RBA to cut the cash rate to 3% next week. This is up from 15 out of 26 who tipped a rate cut last week and 12 out of 25 who tipped a rate cut two weeks ago.

This would equal the lowest cash rate setting, which was in place between April and September 2009.

The Commonwealth Bank continues to expect the RBA to leave the cash rate unchanged, but NAB has changed its forecast to a rate cut, joining ANZ and Westpac.

Westpac subsidiary St.George Bank is tipping the cash rate to remain on hold in December.

St.George Bank will have bragging rights over Westpac’s Bill Evans, should the RBA keep rates on hold.

Looking ahead to 2013, twenty out of 28 economists don’t expect a rate cut in the first quarter of 2013.

Monday will see some important data released which could have a bearing on the RBA’s decision.

The RP Data-Rismark house price index for November is released with economists forecasting a 1% fall in the median house price.

Retail figures will also be released for October with economists expecting a rise of 0.4% following an increase of 0.5% in September.

Just ahead of the announcement, building approval figures for October will be released with economists tipping a 1.6% drop in total dwelling units approved.