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ASX to rise ahead of major RBA cash rate decision

Anastasia Santoreneos
·2-min read
FILE PHOTO - A combination of photographs shows people using automated teller machines (ATMs) at Australia's "Big Four" banks - Australia and New Zealand Banking Group Ltd (bottom R), Commonwealth Bank of Australia (top R), National Australia Bank Ltd (bottom L) and Westpac Banking Corp (top L).    REUTERS/Staff/File photo
ASX to rise ahead of major RBA cash rate decision. Source: Getty

Good morning.

Here’s Yahoo Finance’s Tuesday morning wrap.

The ASX200 is expected to rise at the open, ahead of the Reserve Bank of Australia’s monetary policy decision.

The SPI200 Futures contract is up 18 points to 5,949, indicating a positive start for the local bourse.

In the US, Wall Street’s major indexes bounced back after their biggest weekly loss since March, as investors prepare for a jam-packed week in the States.

The Dow Jones finished up 1.26 per cent to 26,834.97 points, The S&P 500 finished up 0.75 per cent to 3,294.42 points, and the tech-heavy Nasdaq finished down 0.17 per cent to 10,893.11 points.

‘Choppy’, ‘dicey’: These are two words an investment expert has used to describe what we can expect the stock market to look like following election day (3 November in the US, but 4 November in Australia).

RBA rate decision: The Reserve Bank of Australia will meet today to decide on the official cash rate, with 67 per cent of experts surveyed by Finder predicting a cut of 15 basis points to 0.10 per cent.

If the RBA does cut rates, all eyes will be on the retail banks to pass on the cut to their variable home loan rates. If the cash rate cut is passed on, the average monthly saving could be $33 on a $400,000 loan for an owner occupier paying principal and interest.

‘Fresh blood’: Speaking of the RBA, the bank has not met its annual inflation target of 2 to 3 per cent, something independent economist Stephen Koukoulas has said is a “poor result”.

With four board members’ terms expiring in 2021, Koukoulas argues it could be time for some new appointments, and an “invigoration of its operations”.

Aus Post CEO resigns: Christine Holgate resigned with “immediate effect” on Monday, saying she wasn’t seeking any financial compensation.

Holgate faced scrutiny after it was revealed the company rewarded executive staff members who worked on a deal with $20,000 worth of Cartier watches.

Have a great day.

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