*** VIEW: "Westpac now expects two rate cuts....>

RBA: *** VIEW: "Westpac now expects two rate cuts next year from the RBA with

the cash rate cut to 0.25% in June 2020. Quantitative Easing is also expected to

begin in the second half of 2020. Westpac has not changed its rate call for the

RBA since July 24 this year. At that time we envisaged two more cuts from the

RBA in October 2019 and in February 2020. That would have seen the terminal cash

rate in this cycle at 0.5%. We expected that the final cut in February would

have been insufficient to provide the RBA with enough comfort that the economy

was moving into line with their growth; inflation; and unemployment targets.

Consequently, we expected that the RBA would have seen the need for

unconventional policies, largely centred around the purchase of Australian

government securities and clear forward guidance, to maintain the emphasis that

it was still easing policy. That emphasis was going to be important to maintain

downward pressure on the Australian dollar, in particular. Of course there was

always the option to push the cash rate even lower than 0.5% but we assessed

that the RBA would see the impact on confidence and inflationary expectations of

even lower rates to be counter-productive."