Trending Financial News 25 July

More rate cuts are coming in 2019

The Reserve Bank will cut interest rates in October 2019 and February 2020, Westpac economists predict, as unemployment concerns weigh heavily on the central bank.

Westpac chief economist Bill Evans said consumer confidence did not improve following previous rate cuts in June and July. Mr Evans also cited “downside risks for demand, wages and the labour market.” The US Federal Reserve is also predicted to ease interest rates in coming months.

Credit card users in the dark on fees

60 percent of credit card holders are unaware of the fees they can be charged, according to new research from RACQ.

RACQ’s Lucinda Ross said fees for annual account keeping, late payments and exceeding your credit limit can add up to an unpleasant surprise.

“Rewards programs where points can be accrued for flights can attract fees too.”

“Before you apply for a credit card, think carefully about why you want it and how you’ll pay for it.

“Make sure you understand the additional charges which apply to different cards. Think about the features you need and what you’re prepared to pay for them.

Compare credit cards at InfoChoice.

Lenders cut home loan serviceability rates

The big four banks and four other big lenders have reacted quickly to the banking regulator’s cut to home loan serviceability guidelines. Three weeks ago, the Australian Prudential Regulatory Authority dropped the requirement for all lenders to assess mortgage applicant’s ability to repay their loan against an interest rate of 7.25 per cent.

Since then, Macquarie Bank has moved its serviceability floor rate to 5.30 per cent. ANZ, NAB and Suncorp have moved down to 5.50 per cent.

Commonwealth Bank, Westpac, Adelaide Bank, Auswide and others have moved their rate to 5.75 per cent. Bank of Sydney have moved to 5.85 per cent.

CommSec Pocket makes investing easy

Commonwealth Bank has launched a new mobile phone app called CommSec Pocket aimed at empowering savers to take the next step with their money and start investing.

CommSec Pocket enables users to invest as little as $50 directly in the sharemarket via Exchange Traded Funds (ETFs). Many online brokers have a minimum first investment of $500.

CommSec Pocket offers automated regular investing, which is a lot like a regular direct debit to a savings account, except your regular deposit is being invested in shares.

Qantas Frequent Flyer points “now worth it.”

Experts say Qantas’ big changes to the Qantas Frequent Flyer scheme means more seats and cheaper taxes for millions of Australians. The 10million+ members of the scheme can expect one million more economy reward seats and slashed carrier charges.

Qantas Frequent Flyer has reduced the number of points required to redeem economy reward flights and slashed economy international carrier charges by up to 50 per cent. 

“In terms of international economy reward flights, Qantas are now the cheapest,” said frequent flyer expert and founder of IFlyFlat.com, Steve Hui. 

“Redeeming points for economy seats previously just wasn’t worth it.”