The banks may affect our everyday lives, but one economist believes the central bank won't want to be seen allowing them to dictate interest rate policy.
JP Morgan chief economist Stephen Walters is going against the popular tide predicting the Reserve Bank will cut its cash rate next Tuesday to offset the recent round of independent mortgage rate hikes by the big four banks.
"That would be a bad look and argues for unchanged policy, at least for now," he said.
But Mr Walters conceded the rate decision would be finely balanced and complicated by Wednesday's benign inflation figures.
Financial markets are giving roughly a 50/50 chance of a 25-basis-point cut in the cash rate to a record-low 1.75 per cent at the Melbourne Cup Day board meeting.
New figures on Thursday showed the nation's terms of trade, or national income, stands at a nine-year low after three years of decline.
"The result is another indication why super-low rates are likely to be part of the economic landscape over the coming year," Commonwealth Securities economist Savanth Sebastian said.
Deloitte Access Economics says business investment is falling away dramatically, a situation that could continue for another two years.
A moderate improvement in commercial construction activity over the past year had been dwarfed by the dramatic collapse under way in engineering work, it said.
Engineering activity has contracted in nine of the past 10 quarters.
The value of investment projects fell by $6 billion during the September quarter.
However, Deloitte believes the change of federal leadership could provide a new lease on life, having "rebooted" a number of important reform processes - tax, competition policy and the financial system - that have the potential to improve Australia's international competitiveness.
"This is vital to the long-term economic outlook, particularly as the nation grapples with the end of the mining investment boom and the wobbly outlook for the Chinese economy," it said.
New home sales also fell by four per cent in September to stand 5.2 per cent lower than a peak recorded in April.
"Increasingly restrictive credit conditions are likely to curtail the boom in new home building," Housing Industry Association economist Diwa Hopkins said.
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