Australia : RBA must not play Scrooge with rate cut

The threat of further pre-Christmas job losses in the manufacturing and housing sectors must be alleviated with an interest rate cut when the Reserve Bank meets today according to the Construction Forestry Mining and Energy Union (CFMEU).

“Working people with mortgages often do it tougher at Christmas with extra costs. The last thing they need is the fear of losing their job hanging over their heads this December,” said Michael O’Connor, CFMEU National Secretary.

“Low inflation, a projected budget surplus and weak economic conditions in key sectors of the economy leave the RBA with no reasonable alternative. They must cut rates today.

“Small businesses, which employ millions of Australians, would also receive a boost from a cut, and the benefits would flow through the economy.

“A failure to cut rates today would be a failure of the Reserve Bank to meet its obligations to employment under its own Act,” said Mr O’Connor.

Mr. O’Connor said that the manufacturing sector, which employs one million Australians, continued to suffer due to RBA recalcitrance on lowering official interest rates.  
“The Reserve Bank needs to alleviate the pressure on trade-exposed industries such as manufacturing. And a rate cut now would provide a boost for the housing sector.”

“Our members and their employers continue to say that the high dollar is making conditions extremely tough.”

The CFMEU continues to push for better economic management of the mining boom through its http://www.letsspreaditaround.com.au/ campaign.

“The mining sector continues to distort the economy and the dollar is too high. It is important that monetary policy is used to even out economic outcomes for all Australians and spread the good fortune around as we head into Christmas.”

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