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Speaker 1: Now just two more sleeps before the Reserve Bank makes

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Speaker 1: its call on the OCR And there's an interesting dynamic

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Speaker 1: of play here. Markets are firmly pricing in rate cats,

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Speaker 1: but economists are quite divided. Shane solely from harbor asset

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Speaker 1: managements with me.

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Speaker 2: Hey, Shane, Yeah, hey, Heather, what's the.

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Speaker 1: Market pricing in at the point, at this point in time.

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Speaker 2: Yeah, yeah, Look, I think that's a really good point.

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Speaker 2: There is a bit of division out there. The market,

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Speaker 2: the whole sale interest market. This is what we dealing

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Speaker 2: every day. It's pricing at about zero point two percent

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Speaker 2: of a rate cut, so zero point two percent of

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Speaker 2: a rate cap for this meeting, which implies a high

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Speaker 2: but not one hundred percent probability of a normal point

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Speaker 2: two five percent cut. But what is more importantly, I

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Speaker 2: look out to November, there's a whole one percent, just

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Speaker 2: under one percent priced and takes the official cash rate

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Speaker 2: to just under four and a half. And if I

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Speaker 2: go out to July this time next year, we're a

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Speaker 2: whole two percent three and a half. So pretty interesting timing.

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Speaker 2: It's all about the tone, as many things are here

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Speaker 2: that it's all about whether we get a dubbish pause

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Speaker 2: or a hawkish using.

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Speaker 1: I mean, it's going to be dubbish, isn't it, Shane?

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Speaker 1: Is there any other option?

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Speaker 2: You know what? It's the evidence is starting to accumulate

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Speaker 2: that allow us, the Reserve Bank and other central bank

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Speaker 2: is to step away from current sittings they're getting. They're

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Speaker 2: just too tight for where we are. Economy slowed, inflation slowed.

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Speaker 2: So it's whether we actually see a cut this round

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Speaker 2: or it's pushed out. Its tone you know, will be

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Speaker 2: dubblesh it will be hey, we're going to get to

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Speaker 2: cut rates. We're going to be there. And I think

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Speaker 2: interesting really hither is whether the trading banks through mortgages

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Speaker 2: actually do the hard yards for the Reserve Bank. There's

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Speaker 2: still room for them to keep cutting mortgage rates given

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Speaker 2: where that whole cell interstate, that whole sale funding markets moved.

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Speaker 1: Yeah, because it's tough for people out there. I mean,

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Speaker 1: and you'll have seen what Nick Scale is going through, right.

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Speaker 2: Yeah, yeah, well you know nix Sali Australian retailer. It's

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Speaker 2: what about the consumer discriution rand. They came out we

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Speaker 2: did this week and said, guess what what's hurting us

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Speaker 2: in our results is New Zealand June and July just

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Speaker 2: saw traffic drop down thirty five percent Australia in contrast

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Speaker 2: in Philly stable. So sermly they're telling us that things

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Speaker 2: are much tougher in New Zealand and Australia. We know it.

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Speaker 2: Sometimes when you hear it from somebody externally, it's confirmation.

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Speaker 1: Yeah, but a good news from Fletcher Building today. What

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Speaker 1: do you make of that agreement to sell one hundred

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Speaker 1: percent of trade Link.

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Speaker 2: Yeah, look, I think it was expected, but nonetheless it's

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Speaker 2: great that they've done it. It's been sold to a

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Speaker 2: US based family group, pretty good price in the process

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Speaker 2: being used to pay down debt. It's a little bit

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Speaker 2: of a win versus you know, we've had a bit

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Speaker 2: of bad news with Golden Bay supply disruption last week

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Speaker 2: and similarly, where all the eyes are on what happens

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Speaker 2: on Wednesday next weddingstation, say we're the four year result

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Speaker 2: is their potential for additional provisions for some of these

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Speaker 2: major projects. But certainly this puts them in a much

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Speaker 2: better financial position to potentially offset liabilities related to the

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Speaker 2: iPLEX pipe litigation in Western Australia or the silicosis rescue.

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Speaker 2: It's emerging so certainly it's helpful and then the right

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Speaker 2: direction compleatus.

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Speaker 1: Shane's good to talk to you mate, look after yourself.

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Speaker 1: Thank you for that, Shane, Solly, Harbor Asset Management.

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Speaker 2: For more from Heather Duplessy Allen Drive, listen live to

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