RBA board shares concerns on impending rate hike
(19 May 2011 – Australia) The warning of a hike in interest rates came just one day after Westpac chief executive Gail Kelly, Seven Group chairman Kerry Stokes and Westfield managing director Steven Lowy said the economy was too weak to cope with higher interest rates.
The central bank confirmed in its May board minutes, published on Tuesday, that higher interest rates were on the way to bring the climbing inflation rate back under control and harness the economy's future growth.
There was no indication from the RBA on the timing of the decision to take the official cash rate from 4.75 percent to 5 percent. However, financial markets and economists are expecting a rise within the next three months.
One of the RBA's board members, the prominent retailer and Fairfax chairman Roger Corbett, yesterday said the economy was remarkably weak outside of the mining sector.
'The major problem in Australia is we have got a bipolar economy,' Mr Corbett told Dow Jones Newswires.
Mrs Kelly said consumers could cope with just one interest rate rise this year, while Mr Stokes said the economy ground to a halt in November last year when the RBA lifted rates.
There was no indication from the RBA on the timing of the decision to take the official cash rate from 4.75 percent to 5 percent. However, financial markets and economists are expecting a rise within the next three months.
One of the RBA's board members, the prominent retailer and Fairfax chairman Roger Corbett, yesterday said the economy was remarkably weak outside of the mining sector.
'The major problem in Australia is we have got a bipolar economy,' Mr Corbett told Dow Jones Newswires.
Mrs Kelly said consumers could cope with just one interest rate rise this year, while Mr Stokes said the economy ground to a halt in November last year when the RBA lifted rates.
Subscribe