INTEREST RATES - MIXED MESSAGES

Speculation about further rate cuts has intensified, with many economists suggesting the sluggish Australian economy could force the Reserve Bank of Australia to cut the official cash rate at it's monthly meeting on Tuesday.

Mortgage Choice head of corporate affairs Jessica Darnbrough said while there was support for a potential cut, she believed rates would likely remain untouched for the 17th consecutive month.

"The Reserve Bank made it clear late last year that the most prudent course of action was likely to be a period of stability in interest rates," Ms Darnbrough said "The economy has started to turn a corner in recent weeks".

"The unemployment rate has fallen slightly, the Australian dollar has dropped and consumer confidence has started to show signs of improvement".

Comparison website Find.com.au agrees there are mixed signals within the financial sector about the likelihood of rate changes.

Spokeswoman Michelle Hutchison said it's survey of 30 experts, including the major banks, was inconclusive.

Most were forecasting a rate change this year, but they were "more or less" equally divided on whether the change would be up or down.

"While it's unclear which direction the cash rate will move, it's very likely that we will see some movements this year," Ms Hutchison said.

RateCity.com.au product director Peter Arnold said interest rate predictions in Australia were never easy.
"But even by the standards of a crazy past few years, the last few weeks have been particularly strange," he said.
"We started the week with expectations of a February rate cut, and by mid-week that had shifted twice.
"If I were a betting man, and guided by the odds on Sportsbet, I'd be laying my on a 0.25 percentage point cut next week.
"But in truth, I believe it's too close a call".

(article from the Sunday Times 1--2-2015 Mara Fox)

(Who has the crystal ball I ask, lock in your rates if that makes you more secure, however most people reckon the rates are going to move a little more, always talk to your bank or broker about it first)