We're not alone...

and we're not talking about ET.

We've thought for a while that interest rates in Oz had gone as high as they were likely to in this cycle. We figured there'd be a rate cut in November and would not be surprised to see another one or two by Easter. It seems some economists are coming around to the same way of thinking.

Westpac and JPMorgan have predicted more rate cuts than this. Of course, there will be PR departments for both intent on gaining exposure which relies on dramatic headlines. We're more pragmatic.

It's always nice to have others agree with you.

I'm now predicting a Sydney Swans premiership in 2012. Anyone care to join in?

Interest rates plummet

Someone can see the writing on the wall. Actually, it seems everyone can. Fixed rates continue to fall with the latest offering 5.99% fixed for 2 or 3 years. What does that say about variable rate expectations? As always, talk to your broker before fixing and remember you don't have to fix your whole loan.

And a new bank rides into town from 1st Dec - Heritage Bank. Until now a building society based in Toowoomba, Heritage is the latest entity to be given a banking licence. Now if they would only open some branches in Victoria......

Hellenic balancing acts and your mortgage

5 years ago, who would have thought that the outcome of a referendum in Greece could have a big impact on your home loan interest rate? It's quite likely that this will be the case. If Greece decides to go it alone and opt out of the euro, the ramifications could well be felt here.

Which way would rates go? Good question - money markets may tighten up again and funding costs increase, pushing up rates OR the global economy could take another hit and the Reserve Bank may decide that, as inflation seems to be under control in Australia, reducing interest rates will stimulate domestic spending. We're leaning towards the latter option as Christmas approaches and retailers are still doing it tough. Job losses aren't the ideal way to start a new year, and cutting interest rates is one sure way to keep shop assistants in their jobs.

What do you think?