This episode was recorded on the land of the Wurundjeri people of the Kulin nation. We pay our respects to their elders past, present and future.
Richard: Hello, and welcome to another episode of Precisely Property. I’m your host Richard Temlett. I’m excited to have you with us today. If you’re here for the first time, thank you for joining us. I encourage you to listen to our previous episodes where we discuss all things property, with a focus on dynamic discussions with industry leaders. In this episode, we’ll be getting an update on the state of the Australian economy with Besa Deda of William Buck. So, sit back, relax, and let’s get started.
Besa is Chief Economist at William Buck, a newly created role she stepped into in May 2025, marking a first for an Australian mid-tier accounting and advisory firm. Prior to this, she spent 15 years at Westpac Group, including as Chief Economist for several major divisions and has also held senior roles at St.George, Commonwealth Bank, and Colonial. In 2008, she became the first female and youngest Chief Economist of an Australian bank. She’s a regular media commentator known for making economics accessible and currently chairs Australian Business Economists, and sits on the ANU’s (Australian National University) Centre for Applied Macroeconomic Analysis (CAMA) Reserve Bank Shadow Board. Welcome, Besa.
Besa: Thanks, Richard. It’s great to be on today.
Richard: Besa, as we were discussing in today’s episode, we’re going to talk about the state of the Australian economy. It’s the day after what I cannot believe was not a rate cut. It’s the 9th of July (2025) today. The RBA met yesterday, and I’m keen to talk to you about what your views were with why there was no rate cuts.
I personally am absolutely astounded that there was not, but as we were discussing offline, perhaps there’s things that we’re not yet aware of, and that may play out very soon. So, we’ll certainly talk about that, but I’m also keen to talk to you about what’s happened with the economy over the last few years, but then also, most importantly, where it’s going. I can’t think of anyone better placed to talk about these things than yourself. I’ve followed you for a number of years. I love listening to you speak, and certainly have read a lot of your work, and I wanted to thank you very much for coming on the show today.
Before we get into the session, I thought it would be good for everyone to learn a little bit more about you through an icebreaker question, and the question is as follows. During your experience in the industry, what’s a common misconception about the economy or economic policy that you find yourself constantly debunking?
Besa: I guess one of the most common misconceptions, Richard, about the economy is that there’s a quick fix or a silver bullet, and there rarely is. Let’s take yesterday, for example, which you’ve already mentioned. The Reserve Bank surprised markets and economists and the general public by holding the cash rate steady. And in the press conference that followed the decision, the Reserve Bank governor, Michelle Bullock, mentioned that monetary policy works with long and bearable lags. That’s something economists have long understood, but the public often expects immediate results from interest rate moves. So, in reality, the transition is anything but smooth. It’s delayed and it’s uneven. It takes time for either rate cuts or rate hikes to work through the entire economy. And sometimes it can be as long as 18 months.
Productivity is another big one. It’s a really hot topic right now. Jim Chalmers has announced a productivity round table in August, and productivity has been really weak in Australia for a long time. If we want to protect living standards, we need to change that. Now there’s no single lever or silver bullet again, that policy makers can just pull. It really requires a coordinated effort from tax reform, including looking at how taxes work with each other to competition policy, education and workforce mobility among other factors. So, the truth is, steering the economy is more like navigating a cargo ship than driving a sports car. And right now, that ship is facing a choppy course with a rise in protectionism in the US geopolitical tensions, AI disruption, and climate change, all reshaping the waters ahead.
Richard: Great answer. And let me tell you, there’s obviously a lot that we’re going to unpack, over the next period of our session. Thank you for that and setting some of the context. Could you tell our listeners a little bit more? I’m sure a bunch of them have followed you. You’ve recently started a new role. Could you tell us a little bit more about that role and how it came to be?
Besa: That’s right, Richard. I joined William Buck in May. They reached out to me last year to offer to create a role, building a brand-new division of economics. It’s a mid-tier accounting and wealth advisory firm, and notably, it is the first in its space to newly establish that dedicated economics division. Before that, of course, I’d spent 15 years with the Westpac Group, and that was a very exciting and rewarding journey. And my role did evolve over time at the Westpac Group. And I did join Westpac from St.George Bank after Westpac merged with the Dragon. So, I also saw that transition up close under the wonderful leadership of Gail Kelly.
2024, therefore, was a real year of change for me. I took long service leave, and that idea of doing something new took seed. Friends and family warned me not to make big decisions while on a break, but the idea of doing something new really stuck. I couldn’t shake that idea when I returned to Westpac. And so, after a few months, I decided to take a leap of faith and just step away and, I guess, force myself to do something new and fresh. It did surprise many people I worked with, but I think after 15 years, it was a good time to step away.
I also lost my dad last year and he was deeply influential in me becoming an economist. I guess amidst that intense grief, there was also a layer of reflection. That included reassessing what I wanted to do next with my career. And so, it’s fair to say this has been a year of new beginnings and building a brand new department and function, which is economics at William Buck from the ground up is the kind of fresh challenge I was looking for. It’s something strategic. It’s impactful. The firm is growing very fast, so it’s great to be a part of that firm. It’s collaborative and inclusive culture aligned with my own personal values, I find that values matter just as much as the role itself.
Richard: I commend you because I think it’s very inspirational with what you’ve done and I can see, not so much a renewed energy, but you’ve certainly got a lot of energy with what you do, and I have no doubt you’ll be adding significant value to the industry. I wish you all the best in terms of continuing on your role and building up your practice.
Before we get into what happened yesterday, I’m keen to talk to you a little bit more about what’s really happened over the last few years, particularly in 2024, to get to where we are now. So, what are some of your views of the overall economy, especially over the last 12 months?
Besa: I should rewind back a couple of years and assess how much change the Australian economy and the global economy has gone through. Against that backdrop, I think we can say that Australia has displayed greater resilience relatively to a lot of other economies around the world.
If we go back to 2019 to 2022, of course, we faced the impact of the pandemic. As we came out of that pandemic and learned to live with the pandemic and international borders were lifted, that resulted in an inflation spike, including because central banks around the world, including our own, cut interest rates to very low levels to reduce the worst of the impact from the pandemic in terms of scarring and the impact it might have on the economy. As a result of that inflation spike, central banks then had to try to bring down inflation and they did so by raising interest rates. And what we’ve seen since last year in Australia is that inflation has been brought down. It has softened and for the first time it’s also entered the Reserve Bank’s target band. And so, the Reserve Bank is assessing the outlook for inflation. It’s cut the interest rate twice this year, but really the question is when is it going to cut again and how many more times it will cut.
At the same time over the last few years, we’ve seen AI really break through to become mainstream in 2023. That’s really changing the world in many ways. It also has the potential to lift productivity in the future. In 2024 and in 2023, we witnessed the hottest weather on record. Last year, we also saw more than 60% of the world’s population taped the polls and more often than not, we saw the incumbent governments punished. And this year we, of course, also went to the polls, the incumbent government wasn’t punished. We saw an increased majority. And with that increased majority, there’s the expectation that perhaps that means two consecutive terms for the current government and therefore the potential possibly for some major reform to occur. We’ve got that productivity roundtable that (Jim) Chalmers announced in August and maybe that’s an indicator of more reform that potentially will come.
In terms of my views about economic activity and economic conditions right now, I’ve resurrected my toddler analogy, Richard, where the economy is a bit like a toddler learning to walk. It still needs the furniture for support. And in this case, the support is coming from the government sector, which has been propping up economic activity. In fact, public demand as a share of the economy is hovering near record highs. But for a sustainable economic recovery, we need the private sector to do a bit more heavy lifting, especially households, so that economic activity finds its footing in a sustainable way. Household spending has been soft. In fact, in per capita terms, it resumed its decline in the March quarter after a brief reprieve late last year. Retail turnover data, which comes out more frequently, remains subdued and consumers are still cautious despite two rate cuts from the RBA in February and May.
One area we’re watching closely is business spending. Recent liaison with business customers suggests it’s starting to soften, a trend worth monitoring. And all of this, of course, is playing out against a backdrop of heightened uncertainty. That is, there’s escalating trade tensions, new tariff threats and ongoing geopolitical risks, which are all adding another layer of complexity to an already fragile economic environment.
Richard: Thanks for that update. Let’s jump on to interest rates and what are your views on interest rates and the role of the RBA? And its probably particularly relevant given yesterday’s announcement, and I appreciate that there have been changes compared to how the rate decisions were announced and how often the RBA meets now. But I suppose my question to start things off is, what are your views on rates, and the role of the RBA?
Besa: Yeah. I mean, I guess, first of all, yesterday’s decision to stay on hold at 3.85% following rate cuts in February and May was a big surprise to almost everyone. To put that into perspective, Richard, markets had priced in more than a 90% chance of a cut yesterday and 27 out of 32 economists in a recent Bloomberg poll expected a cut. And that was myself included. One digital headline perhaps summed it up best and led with just three letters, O M G or, Oh My God.
Look, Governor Bullock more seriously explained the decision in the press conference that followed the decision. And she repeatedly said that it’s not about the direction of rates, but the timing. And I’ve taken that to be code for more rate cuts are coming, but it’s a question of timing. The RBA appears to be holding out for the quarterly inflation report on 30th of July to confirm inflation is easing in line with their forecasts. If it is, we expect a cut in August when they next meet. If it’s not, the wait could drag on.
In our view with economic activity sluggish, especially household spending and global growth clouded by uncertainty, the longer the Reserve Bank waits, the more risk there is that they’ll need to cut harder down the track. So, we now see rate cuts in August and November, and that aligns with the bank’s gradual cautious stance, a view markets also currently share. But as we’ve seen, Richard, a lot can change quickly. As for the RBA’s role, it’s to set monetary policy to keep inflation within a 2-3% band over time while supporting full employment and promoting Australia’s broader economic prosperity. The main tool it has available at its disposal is the cash rate. The cash rate influences borrowing, spending and investment in the economy. The RBA also oversees financial stability. It manages the country’s foreign reserves. It issues the nation’s currency and it is the government’s bank.
Richard: Very interesting. Besa, can I ask you before we jump onto the risks and the opportunities, what is your view on what, I suppose, a cash rate neutral figure is for the RBA?
Besa: That’s a great question because economists and markets are really focusing on this neutral rate, and it is a theoretical figure. A good way for the general public to think about what the neutral rate is, is it’s that rate for the cash rate that is not applying stimulus to the economy, nor is it applying a break on economic activity. And our assessment is that that neutral cash rate is 3.1%.
Some analysts might have it a little bit higher or a little bit lower, but it means that the current cash rate of 3.85% is restrictive. And the rate cuts that the Reserve Bank delivered in February and May represent the Reserve Bank taking its foot off the brakes slightly, but the foot is still on the brakes because it’s not near neutral. So, we anticipate the Reserve Bank will want to get the cash rate back to neutral of 3.1% over time to help bolster economic activity. But it can only do this if inflation continues to soften towards the middle part of its target band and the Reserve Bank’s very own forecast that it published in May has it anticipated that the inflation will do this precisely. But I guess in the press conference yesterday, the Reserve Bank governor just seemed a little bit nervous that it needs the confirmation of that quarterly inflation report to give it confidence that that’s actually what inflation is doing.
We do have monthly inflation measures, and we certainly had the ones for April and May. And in particular, Richard, the one from May, moved to the bottom half of the Reserve Bank’s target band of 2 to 3%. But the Reserve Bank’s preferred measure of inflation is the underlying rate, which is the trimmed mean measure that dampens the impact of volatile price movements. And that is published in that report that comes out on the 30th of July.
Richard: Gotcha. That makes sense. Let’s shift gears. Can we talk about some of the major risks over 2025 and 2026? I’m assuming you’re going to say things along the lines of the RBA is waiting for a longer period of time before they cut rates. But, obviously, rather than making those assumptions, what in your mind, having lived and breathed through various economic cycles, what are some of the major risks everyone needs to be aware of?
Besa: Yes. So, I guess the very cautious and gradual approach of the Reserve Bank means that there is a risk that economic activity doesn’t pick up as slow as what they’ve anticipated, and inflation does soften perhaps a bit quicker than they expect down the track. And so, then they might need to do more in terms of rate cutting next year. That is a risk. We’ll have to see what that quarterly inflation report delivers to assess how much of a risk that is.
I guess in terms of major risks, though, we really cannot go past what’s happening with US tariffs policy. It is uncertain and it is unpredictable, and it is throwing a gray cloud over the global growth outlook. The pause on reciprocal tariffs was set to end tonight, the 9th of July in the US, and that has been recently extended by the US Treasury to 1 August. The universal baseline tariff of 10% appears to be staying. Some countries, more than a dozen, which includes four of Australia’s major trading partners like Japan and South Korea have received letters from US President Trump this week announcing their reciprocal tariffs, and they do match or exceed those that were announced on liberation date in early April.
What’s important to remember is that there’s also a lot happening at the sectoral level. Australia steel exports already have a 50% tariff applied and overnight, Trump also announced that US copper imports would be slapped with 50%. And then we can’t rule out an impact on Australia’s pharmaceuticals industry. The market is discounting the worst-case scenarios, but Trump so far has proved to be unpredictable. And so, there is some risk with fully discounting some of the worst-case scenarios. Look, he has earned the moniker TACO, which stands for Trump Always Chickens Out. And I guess perhaps markets are relying on that a little, but will he continue to be a TACO? Does that always hold? I think we just don’t know. And we can’t rely on that fully.
What’s important to remember is the golden rule. And what is the golden rule? The golden rule is that markets and businesses do not like uncertainty. They crave certainty for making decisions. So, it means this heightened uncertainty is providing downside risks to business investment in the US, and is disrupting worldwide supply chains, and is lowering world growth. The International Monetary Fund, which are arguably the best forecasters of world growth earlier this year, did downgrade global growth. They cut it from 3.3%, which they forecasted in January for 2025, to 2.8%, which is a soft pace of economic activity. And for Australia, that’s important because even though the trade that we do with the United States is quite small, we are an open small economy where our trade is very reliant on what the shape of global growth is and what the health of our major trading partners growth is. And, China has been in the firing line. They are our major trading partner, but also the rest of Asia is also impacted as is the rest of the world, I should add.
Now for Australia, there’s also a question as to what does it mean for the inflation outlook? And the risk is that if these reciprocal tariffs go ahead come 1 August, or as it becomes clearer as to what the reciprocal tariffs will be on other economies around the world, not just the ones that have received a letter this week, it could be that countries will need to find alternative markets for their goods and in doing so they discount those goods to find alternative markets. And so there could be downward inflation pressures on economies like Australia. I should also add that inflation in China and wholesale inflation is already quite soft.
Now in markets, what are some of the risks, Richard? Well, if we look at markets like share markets and we look at forward looking indicators like forward price earnings ratios, they’re suggesting that share market valuations are stretched, more so in the United States. Now given AI has so much further to run and is helping push up those valuations, these valuations could be warranted. But it also opens up share markets to a sell-off if geopolitical or geoeconomic risks rear their head. And what we’ve seen this week is geoeconomic risks in the form of Trump reviving those threats around reciprocal tariffs have spurred on fresh selling in share markets. So, there are those stretch valuations and there are market divergences, which could also be pointing to risks as well as opportunities.
For example, bond yields on longer dated bonds are elevated in the major economies, especially in the United States where bond investors are demanding a premium to compensate them for the risk of holding long dated US bonds. Bond investors are worried about the sustainability of the US fiscal position, particularly after the One Big Beautiful Bill has passed, which is worth $3.6 trillion. If we look at the US yield curve, for example, if we look at the difference between the US 30 year government bond yield and the US two year government bond yield, it’s quite wide and it’s displaying a steepening of the curve and also reflects the fact that the US central bank has held fire on cutting rates because of the uncertainty from US tariffs. What that has meant though, is that the Japanese yield curve, which is also steepening, is steeper than the United States. And it’s steepening for different reasons to the US, which I won’t go into because it’ll lengthen this podcast considerably. But the important point, Richard, is that the Japanese yield curve has only been steeper than the United States yield curve on three prior occasions in the last 25 years. During the US recession in 2001, during the GFC (Global Financial Crisis), during COVID and of course, the current period. Those first three episodes, they’re all significant economic events. So, it begs the question now that the Japanese yield curve is steeper than the US yield curve, is this another significant economic event? Is this an amber light or is it just that the economic conditions are different? In particular, Japan has finally shaken off decades of deflation and is now experiencing inflation. And the Bank of Japan is in a tightening policy mode, not in an easing policy mode.
We can also see a divergence between US longer dated bond yields and the US dollar. Unusually the US dollar is weakening whilst US bond yields are remaining elevated. Now that might mean that some funds are moving to Europe where governments have approved a lift in defense spending from 2% to 5%, and that’s opening up opportunities in Europe and stimulating economic activity in the Euro zone as well. So, look, there’s plenty of risks there, but those risks also do open up opportunities.
Richard: Well, thank you very much for that detailed dive. Let’s jump into the opportunities because I appreciate that, yes, it’s been very volatile, and your comments about everyone requiring certainty is very well made. What are some of the opportunities looking at it from a different angle, perhaps even a glass half full approach? What are the opportunities that you see over 2025 and into 2026?
Besa: Well, when we talk about opportunity, it’s not always in spite of the risks. It’s often because of them. I guess some of those divergences I spoke about, particularly with markets, means that volatility will be higher and volatility creates dislocation and disruption. And that’s not always a good thing, but it does create opportunity because it can create value, whether that’s in market supply chains or policy settings, particularly for those investors or entrepreneurs that are willing to take the risk to identify those opportunities and make the best of those opportunities. In 2025 and next year, I think some of the biggest opportunities will come from three core areas. It’s the structural mega trends, it’s the geopolitical shifts and it’s the domestic economic transition.
So first of all, the structural mega trends, what are these? These are the big slow-moving forces that are reshaping the global and Australian economy as we know it. We’re talking about the aging population, the net zero transition, the AI and innovation boom and the push to lift productivity because productivity is not just weak in Australia, it’s weak everywhere in the major economies except for the United States. All of these open the door to targeted investment, so think about industries like aged care, healthcare, renewables, energy, critical minerals, grid infrastructure, data centers, cybersecurity and education skills and retraining.
Then if we think about the second one, which is geopolitical shifts, which is also reflecting the fragmentation of the world or globalisation, as we’ve known it for a long time, we’re moving away from a globalised system to greater protectionism and that’s reflected in what’s happening with tariffs as well.
At the same time, defence spending is ramping up, particularly in Europe and parts of Asia. And so, we’re also seeing governments and companies onshore critical supply chains as a result in semiconductors, energy, food, pharmaceuticals. That means more money is moving into these industries. And we could argue that Australia is going to benefit from that. We’ve got raw materials, we’ve got a stable political environment. Our geopolitical alignment is probably such that we’ve got a sweeter strategic spot relative to many other countries. There are opportunities there.
At the same time, Australia is also going through its own economic transition. There’s the productivity transition that I’ve spoken about, the fact that we need to lift productivity to lift our living standards, but also, if we think about there’s a housing issue that we need to tackle and the government is trying to tackle housing supply, which could drive up construction and planning reform, particularly given that the population continues to grow. There continues to be demand for housing but supply is struggling to keep pace with that. And so, it is pushing up house prices. It is pushing up rents, and that is making housing unaffordable for the younger generation.
In addition, Richard, there’s fiscal policy where state and federal governments are spending, and that means a strong pipeline of activity and opportunities in sectors like public infrastructure, clean energy and innovation, which I’ve mentioned, but there’s also the fact that there is spending by the government going into those areas. And on the financial side, as I said, there’s that opportunity for volatility and that tactical response by investors and businesses to stay nimble, understand cycles and position early, which will best place them to right the upside when clarity returns.
I think in this current environment, it’s very important to remain diversified across asset classes and within asset classes. But the major themes continue to be AI, defence, renewables, critical minerals. We can’t go past those themes given they play into the longer-term economic growth opportunities.
Richard: Right. Well, thank you again for a very thorough answer. That was a massive learning experience for myself and certainly, I’m sure, for the listeners. At Charter Keck Cramer, we do a lot of work in the housing market, and so I look at what the RBA is doing and the impacts and how it flows through to the housing markets. I know that the RBA is not around to set house prices, and they’ve obviously got a much greater role and wider views to play and then a view that they have on their wider economy, as you’ve very well-articulated. I am interested, though, to get your views on the housing crisis that we have and where you feel the housing market is going in light of rate cuts or potential rate cuts.
Besa: Yeah. I think that’s right, Richard. They don’t target the housing market. But I guess housing is a very hot topic all the time. It’s the thing you talk about at the bubbler at work. It’s the thing you talk about at a barbecue on the weekend, and it’s very much top and center in Aussies’ minds. I guess housing supply continues to remain a big challenge for Australia right now. The population is growing strongly, particularly from immigration, but new housing supply is not keeping pace.
If we look at the trends in building approvals and building commencements, they’re well below where they need to be. That is sustaining upward pressure on prices for both rents and for buying new homes and existing homes. I guess a feature that’s been different post COVID is that we not only have seen upward pressure on prices to buy homes, but also upward pressure sustained on renting a home. That piece has been a little different, but it’s also added to the challenge in the housing market. And what I’d say, Richard, it’s not just about building more homes. It’s also about building more homes faster and making them easier to get built with the right planning, zoning and infrastructure in place. The reality is even with reforms underway, it’s going to take years to close the gap between demand and supply. We do expect house prices to keep rising in this environment. Rate cuts, we’ve had two so far, and there are likely to be more, even though the Reserve Bank did stay on hold yesterday, it has given the market a bit of a boost. Affordability has improved just slightly, but let’s be clear in most major capital cities, affordability has improved from historically low levels. Affordability still remains very low.
Now, if we think about where dwelling prices are, since the first rate cut in February, we’ve seen national dwelling prices rise by around 2%. The standout has been Darwin. That market in the last few years has been one of the softer markets, but that’s been the market that’s risen the most since the first rate cut in February, we’ve seen prices there jump 6%. We’ve also seen strong momentum in markets like Adelaide, Perth and Brisbane, which have been standouts in recent years. With more easing likely, Richard, I think the trend of higher prices is set to continue.
Richard: Well, Besa, thank you for your thoughts on the housing market. I know we’ve got through a lot today. Do you have any closing thoughts, that you’d like to leave our listeners with?
Besa: I guess the main thought to leave people with is what I opened up with where I ran through how much we’ve been through since 2019. In the space of around five years, there have been lots of challenges that have been thrown at the global and Australian economy. And through that, I think the Australian economy has navigated that quite well. Yes, we did have a technical recession through COVID. It was very short lived though. And I think when you look at the Australian economy, it has been very resilient through that. I guess despite all the challenges that we’re facing and there are also opportunities, I’m encouraged that we will continue to find a pathway that keeps the Australian economy resilient.
Richard: Great. Well, I’m glad we finished on a positive note. I wasn’t sure how that session was going to finish today given what happened yesterday, but we will have to just see over the next couple of months how things play out. I wanted to thank you so much for taking the time to come on the podcast. I know how busy you are. I know you were saying that before we recorded the session you were on the news. So, thank you again for making the time to share your very good views with everyone.
Besa: Thanks so much, Richard, for having me on your podcast. I know it’s a very popular podcast, so I appreciate the invite. And I hope the listeners have enjoyed this podcast. And you’re spot on, there is a lot happening in the economy. We are being kept on our toes. So, there’ll be a lot to weave through in coming weeks and months.
Richard: Great. Well, thanks again, and we’ll be talking soon.
Besa: Thanks, Richard.
Richard: Hi, everyone. I hope that you got a lot out of the session with Besa today. I thought it was absolutely fantastic listening to what she had to say. She’s obviously a wealth of knowledge. The three takeaway messages, and there were certainly many more, but I wanted to do three of her ones and then one of my own, are as follows.
I loved her analogy about how managing the economy is much more like driving a ship or steering a ship rather than a sports car. And I think that there’s a risk, certainly, in the world of property where I live, where I don’t take a wider view of what else is at play. And there’s so many factors that the RBA does need to take into account when making decisions about whether to cut interest rates. I think that that’s important to keep in mind. I think people in their different segments of the market, whether it’s the property or the financial services sector, perhaps need to, much like myself, keep that in mind in terms of an explanation for why rates do or don’t get cut at certain points.
I enjoyed Besa’s comment about the neutral rate being 3.1%. If that’s the case, then there are a few more rate cuts to come. Certainly, when I’ve spoken to various other economists, as well as doing my own reading, it does seem to be very close to what the neutral rate is. And, certainly, given the preeminent expertise of her, I’m certainly more than happy to follow her recommendations as to 3.1% being the neutral rate.
The final point from her that I thought was very interesting, and I certainly see this in the private credit spaces, with that volatility in the market, there is a lot of locational disruption to the market. However, there’s also a lot of mispricing of assets and I’m thinking that that is where a lot of the opportunity lies if you do your well-educated due diligence or market research.
The final point I’ll make is that whilst I didn’t ask this question about whether the RBA should have cut rates yesterday, I was absolutely astounded that they did not. My initial gut reaction is much more that they were almost looking at making decisions about the economy through an Excel spreadsheet, rather than walking around shopping centers or walking around various streets and houses across Australia to see how people are genuinely struggling. I cannot believe that there was not a rate cut yesterday. I am absolutely astounded. And I think that yesterday’s decision is much like the one in November a few years ago where there was that final rate rise that absolutely knocked the wind out of the market. I don’t believe it’s going to knock the wind out of the market now, but the market could have started to accelerate. There would have been much more momentum, and certainly, they would have flowed through to the housing market had there been a cut yesterday.
I hope that we will have to be patient and see when the next meeting is in August and then perhaps later in the year, perhaps in November, whether those rate cuts do flow through because that’ll increase buyer capacity. And that market that’s the momentum that the market, especially the housing market in Melbourne, so desperately needs to start to recalibrate and get back into balance will start to occur. But, again, we’ll just have to be patient and hope that Trump doesn’t do anything out of the ordinary, even though I’m not really sure what that is these days, because that obviously does distort markets and cause that uncertainty that was very well articulated throughout this podcast. Anyway, I hope you have a good rest of the day. Thank you.
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