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Westpac Banking Corporation’s (ASX:WBC) Chief Economist Bill Evans has backflipped on his rate call for Australia’s key cash rate and no longer expects rate cuts this year.
The bank says it now expects the Reserve Bank of Australia (RBA) to keep rates steady in 2014 and increase rates by 25 basis points in the September and December quarters of 2015.
Previously the bank expected the RBA to cut rates by 25 basis points in both August and November 2014.
Westpac’s revised forecast comes after the RBA decided to keep the official cash rate on hold at a record low of 2.5 per cent for its sixth straight meeting in March.
Australia’s central bank said earlier this month the most prudent course for the key cash rate is likely to be a period of stability.
Westpac Banking Corporation reported a net profit of $6.89 billion in the 2013 financial year.
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