Westpac expects rate cuts to drive savings

Australian consumers are likely to save rather than spend any extra money available to them following the central bank’s decision to cut interest rates according to Westpac Chief Executive Officer Gail Kelly.

“What will happen is that customers will take the extra cash that they’ve got and probably apply it more to debt repayment and to savings,” Kelly told the ABC.

Kelly said she thought the RBA will need to make further rate cuts. “Let’s wait and see how Europe travels over the next period, but there don’t seem to be too many signs that things will settle too early,” she said.

Source: Bloomberg