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Market prediction slammed as ‘fundamentally wrong’

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After pollsters and media commentators were proved wrong in Brexit and the US election, the consensus on the direction of Australian interest rates has been labelled “absolutely false”.

ABC Bullion chief economist Jordan Eliseo says predictions that the RBA will not make any more cuts to interest rates are incorrect.

“One of the things I think the market has got fundamentally wrong and what a lot of commentators have said is that the Reserve Bank is done and that there won’t be any more interest rate cuts. I think that’s absolutely false,” Mr Eliseo said.

“I think there will at least be a couple more next year, so that again is going to put more pressure on retirees and SMSF trustees.”

Further cuts would make term deposits even less attractive and would likely see those nearing retirement look to diversify their current portfolio holdings.

“Retirees will again have to look to alternative asset classes in their portfolio and I’m sure one of the beneficiaries of that, although not the only one, will be gold,” Mr Eliseo said.

“SMSF trustees, and particularly investors nearing retirement, need to have a good and broad asset diversification so that you’ve got one or two assets performing well in your portfolio and you’ll probably have one that’s underperforming irrespective of what happens in the environment.

“If interest rates go lower, then that’s obviously bad for cash but you don’t want to pile all your money into equities because if you get a stock market sell off, then you’ve been hurt there as well.”

Market prediction slammed as ‘fundamentally wrong’
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Anonymous - Why does this get all the media attention when in reality it affects very few and the charges are minimal? How about reporting on all the ISA TPD.......
Anonymous - This got to be the smartest comment this century ?!....
nan - So what do you do if you are being ripped of and then can't afford the body corporate fees....
MarkL - The banks may not charge dead people any more ........... but they won't charge them any less either!....