The RBA is likely to keep cash rates on hold today as a weaker AUD has relieved the pressure of a rate cut in stimulating economic expansion. The better-than-expected housing and manufacturing data yesterday reaffirms the RBA's view that the rate cuts since Nov 2011 have begun to lift demand, says Saul Eslake, Chief Economist at BoA Merrill Lynch. Markets were pricing in an 18% chance of a 25bps cut today. J.P.Morgan economist Tom Kennedy says he is forecasting one more rate cut in November, and another cut in the first quarter of 2014, bringing the cash rate to 2.25%.
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