Rate cut on the horizon?: Westpac Chief Economist weighs in

According to Westpac Chief Economist Luci Ellis, the probability of an earlier rate cut has increased, but it's still too early to make a definitive call. During a recent interview with Sky News Business Editor Ross Greenwood, Ms Ellis noted that Westpac's base case for a rate cut is May, but the likelihood of an earlier cut has risen slightly. However, she emphasised that the decision to cut interest rates will depend on various factors, including the December quarter inflation number. “I think it's fair to say that the probability of an earlier rate cut than our base case of May has increased at least a bit but we said that when we changed our call to May it was really about, you know, previously our base case had been February with a risk of sort of something later and then the probabilities just sort of switched a little bit,” Ms Ellis said. “They've come back a little bit the other way but I really wouldn't want to make a you know hand on the heart call about whether you know February's on the table until I see that December quarter inflation number.”