RBA tipped to cut interest rates in March
Economists forecast more mortgage relief is on the horizon for homeowners this year, with the Reserve Bank of Australia tipped to slash the official cash rate below its record low three per cent.
Westpac chief economist Bill Evans said subdued consumer sentiment will potentially stifle growth - a trend that may act as a catalyst for a rate cut in March.
"The case for a further rate cut as early as the February meeting is still reasonable. Prints for employment and inflation over the next week will be important in this regard," SmartCompany reported Mr Evans as saying.
"However, a prudent Reserve Bank which has seen a resurgence in the terms of trade, is likely to defer in February to await further evidence around the impact of the rate cuts. Accordingly we have opted for the next cut in the March end of our forecast 'window'."
The forecast comes after the latest Westpac-Melbourne Institute consumer sentiment index recorded a modest rise.
Carried out between January 7 and 13, the index increased 0.6 per cent to 100.6 over the month - a result that was described as "disappointing" by Mr Evans.
However, the 2013 outlook is not all doom and gloom - the latest Property Council of Australia/ANZ Property Industry Confidence Survey showed an improvement in real estate sector confidence.