Say ZIP has $2.5 bil borrowings at BBSW & margin. Technically,...

Say ZIP has $2.5 bil borrowings at BBSW & margin. Technically, as those things flow through, they should remove $6.2 mil from borrowing costs for each 0.25% interest rate change..........although margins, timing and any hedging could distort that. A full 1% would be $25 mil, the same as the exit fee the directors signed up for in the corporate refinance.............if the SP stays at 48 cents. Presently it would be about $64 mil. Thanks a lot, it was a winning strategy. Will the corporate loan rate of 15% be reduced in July when it is renegotiated? If it was reduced to 12%, the annual interest cost would go from $22.5 mil to $18 mil.

However...............should you expect interest rate falls, which are primarily designed to stimulate economies to have a greater impact on ZIPs busiess in view of retail sentiment, which is already sky freaking high in the US and deathly in Australia? It will be a long time before the US reduces rates substantially IMO, because they are yet to kill off inflation as they are committed to doing. So interest rate impact on demand for retail - how long is a piece of string?