One industry stakeholder is urging the Reserve Bank to leave the official cash rate on hold for the rest of the year.
Loan Market Group’s chief operating officer Dean Rushton said the RBA’s decision to leave the cash rate unchanged at 4.75 per cent yesterday was a “sound move”.
He said there was no reason for the RBA to lift rates this month or any other month in 2011.
“The four rates rises they implemented in 2010 are still having an impact through much of the economy,” Mr Rushton said.
“The RBA should weigh less of the decision on what’s happening in the minefields of Western Australia and focus more on what’s happening to retailers out there.
“There have been some major business failures recently and if you walk through any suburban shopping centre or retail strip you will see shops that have closed down.
“Consumer sentiment remains soft and many elements of the economy, including the home finance market, continue to lag.
"The last thing they need now and in the foreseeable future is for interest rates to go up. Any rate increase would be a serious setback to consumer confidence which is quite fragile at the moment.”