Following the rate cut this week, AMP’s Shane Oliver has speculated about how many more cuts lie ahead, and I think he is right on the money.

If you are thinking about fixing your home loan interest rates, you might want to read this first and listen to an expert. Not me, but AMP’s chief economist, Shane Oliver.

On Tuesday the RBA board followed the sensible script that most economists expected and cut the cash rate by 0.25% taking it to 3.85%.

Following the event, the CBA contacted customers and said it would be cutting its home loan variable rate of interest by 0.25% but threw in the fact that the cash rate is not the only issue the bank considers when changing the home loan rate to customers.

How low will home loan interest rates go?

In guessing our interest rate future, I like to look at the thoughts of those who are paid to gaze into their crystal balls over such things: the economists, fund managers and company analysts.

AMP’s Dr Shane Oliver is a quality assessor of the Aussie economy, so I’d like to share with you what he and his economics team is thinking about future rate cuts.

This could be valuable if you want to plan your future spending or fixing your borrowing rate for when interest rates start to rise again.

Here are Shane’s views, with a few of my interpretations thrown in:

1. The RBA is cautious about the economy going forward.
2. It is wary about Donald Trump.
3. He expects further cuts in (drumroll please) August, November and February.
4. A July cut, according to money market players is at 50:50 odds right now!
5. That means we should expect three 0.25% cuts which takes the cash rate down to 3.15%.
6. The all-important trimmed mean inflation reading is tipped by the RBA to be around 2.6% from this year to 2027.

Ultimately, this is his take on the RBA’s thinking:

“The RBA remains ‘cautious about the outlook’, but it has become progressively more dovish (supportive) since its February meeting. The RBA is no longer referring to a further tightening in the labour market, nor is it referring to the risks of easing “too much too soon”, it now sees underlying inflation back at target, it sees the risks to inflation as having become “more balanced” and its now more concerned about the threat posed by the US tariffs and sees this as being disinflationary for Australia.

“And as in April, RBA Governor Bullock is no longer pushing back against market expectations for further easing as was the case in February. The RBA reiterated that it will “be attentive to the data and the evolving assessment of risks”, but overall, it appears to be leaving the door open for further easing.”

So long as Donald Trump does not do anything to annoy the lives of innocent people worldwide and unnerve big companies, we ought to see Dr Shane’s predicted triplicate of cuts in bank lending rates.

Of course, if Donald comes up with crazy trade and tariff deals to unleash on the global economy, the fear of a Trump-created recession would mean we could see five more cuts rather than three.

I agree with Shane that three more cuts make sense, and I would not be thinking about fixing my rates until I see what looks like a bottom of the rate cut part phase of the rates cycle.