The author has been described by News Ltd as an "iconoclast", "Svengali", a pollie's "economist muse", and "pungently accurate". Fairfax says he is a "Renaissance man" and "one of Australia’s most respected analysts." Stephen Koukoulas concludes that he is "85% right", and "would make a great Opposition leader." Terry McCrann claims the author thinks "‘nuance’ is a trendy village in the south of France", but can be "scintillating" when he thinks "clearly". The ACTU reckons he’s "an enigma wrapped in a Bloomberg terminal, wrapped in some apparently well-honed abs."

Tuesday, April 24, 2012

Koukie forecasts 50bp or possibly 75p cut in May

The ALP economist and former contributor to this blog, Stephen Koukoulas, reckons given the spectre of deflation we will get a 50 basis point cut in May, and possibly 75. On Twitter, he responded to the CPI data commenting, "here comes 50 or even 75", and then, "RBA must cut 50". I guess anything is possible, but at this stage I think 25 is much more probable. Sudden cash rate cuts actually create profitability problems for bank treasuries (if you speak to them about this issue), which have locked in a lot of their funding via fixed retail term deposits and wholesale debt...And then there is the question of what the budget actually looks like.