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Business Calls for Christmas interest rate cut

Release Date: 4/12/2012

Illawarra Business Chamber said today was the last chance for the RBA to nurture a pre-Christmas rebound in business optimism by further reducing interest rates.

The NSW Business Chamber – Commonwealth Bank Business Conditions Survey revealed that NSW business operators were more optimistic heading into the crucial Christmas trading period, but this improvement in sentiment is fragile following previous results of the survey showing conditions had returned to GFC levels.

“The business community is hoping this Christmas season will be a circuit-breaker from what has been a volatile and difficult year for the economy. The RBA decided to stay its hand last month and keep rates on hold; this is the last chance for the RBA to act and provide some Christmas cheer to business operators and consumers alike,” said Mike Leask, CEO Illawarra Business Chamber.

“Our most recent business conditions survey shows that business operators are more optimistic that business conditions, sales revenue and profits may return to positive territory in the next quarter. What we need is the RBA to nurture business and consumer confidence by delivering a rate cut.

“The global outlook continues to look downbeat with the difficulty in the Eurozone and the American economy on the edge of the ‘fiscal cliff’. The Australian dollar continues to remain stubbornly high inflicting tremendous pain on our trade exposed enterprises and consumer confidence has remained low for most of the year. Business needs the RBA to get behind the Australian economy by cutting interest rates to help ensure that conditions over the Christmas period meet expectations.

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