Stocks that could win from the recent RBA rate cut

Founder and Publisher of the Switzer Report
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The Reserve Bank followed the script written by banking chief economists and the media and lowered the official cash rate for the first time in 33 months to an historic low of 1.25% after a 25 basis points or a quarter of a percent cut.

Two of the major banks passed on the interest rate cut in full to their borrowers, while the others passed on most of the cut. This should encourage consumers to spend and in due course businesses to invest and hire more, which will help economic growth and then improve the bottom line of many businesses, including those on the Australian stock market.

An additional oomph from this rate cut should be a lowering of the Oz dollar and that not only helps our exporters sell more, but it makes the exports of other countries dearer compared to local rivals. As a consequence, the Gold Coast as a holiday destination becomes more attractive compared to Hawaii, which can bring more tourists here and reduces the number of intrepid Aussies who head overseas for their annual holidays.

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