(7 October 2009 – Australia) Australia’s Treasurer, Wayne Swan, said that because the economy has begun to recover, the RBA has rightly exercised its independence and moved rates accordingly.Reserve Bank of Australia (RBA) raised the cash rate by 25 basis points to 3.25 percent following the October round of its monthly board meetings.
The majority of economists had expected the RBA to leave the rate at its ’emergency’ level of three percent for at least another month.
Federal Treasurer, Mr Wayne Swan said that it was important to remember that rates have been at emergency levels in a bid to stimulate the economy.
Australia is outperforming other advanced economies, and many economists will see the decision as a consequence of economic recovery, he concluded.
Before the rate decision, Liberal MP Scott Morrison, said, there was no justification for raising rates, and that the best thing for the economy was for them to stay low.
In retaliation, Mr Swan argued that if the opposition had its way, unemployment would be far higher, more businesses would be bankrupt and Australia would be a different place.