Interest rate cut necessary before Christmas

The State’s leading business membership organisation, Business SA, has responded to today’s decision by the Reserve Bank Board to maintain official interest rates at 4.75 per cent.

Business SA Chief Executive Officer, Peter Vaughan, said that while today’s decision was expected, a cut in interest rates is required before Christmas.

“We had expected interest rates to remain on hold, however the Reserve Bank must now seriously look at decreasing rates,” Mr Vaughan said.

“As we enter the very important Christmas trading period, consumers need the confidence to get out and start spending again.

“Business and consumer confidence remains low and a cut in interest rates would provide a much needed boost to the economy at what is a very important time of year.

“The Reserve Bank’s premature interest rate rise over last year’s Christmas trading period was extremely damaging and it is essential that we have consumers spending in the coming months.

“Economic data continues to highlight the widespread strain on businesses throughout the country and rising costs are adding to the challenges for local businesses.

“Many important industries throughout South Australia remain under pressure and it is essential that businesses have confidence in the economy to employ more workers in the lead up to Christmas.”