Westpac - 19 February 2008

There have been a number of events over the last fortnight that are highly relevant to the future course of interest rates in this country.  The first was the Reserve Bank's revised inflation forecast in the quarterly Statement in Monetary Policy.  The second was an extremely strong jobs report for the month of January.  The third was the release of the minutes to the RBA's meeting of February 5.  The cumulative force of these events convince me that not only are rates going to rise at least twice more this year, they are likely to remain high for the forseeable future.  Rate relief is a very distant prospect indeed..................