More Interest Rates Speculation from Treasurer

17 September 2009

It seems as if everyone across Australia is talking about interest rates, when they will rise, the affect this will have on credit cards interest rates and how it may change the future of the Australian credit cards industry.

In an interview with the Sydney Morning Herald, Treasurer Wayne Swan explained that the rise of interest rates was inevitable as the Australian economy recovers with factors such as unemployment and national prices and measures begin to climb.

''Our interest rates are a product of what is going on in the global economy as well as decisions by our Reserve Bank,'' he said.

In terms of Australian businesses, Mr Swan said that he expects global interest rates to return and even climb higher than what they were recorded at prior to the Global Financial Crisis, while the slow growth being reported worldwide will also impact on Australian commodities.

The Treasurer explain further about the benefits of the Federal Government's stimulus package while shadow treasurer, Joe Hockey, insisted that the stimulus was only one of five factors that made the Australian economy fairly resistant to recession including the prices of Australian exports and cuts to the Reserve Bank interest rates.

Mr Swan fought back though, stating that ''To hide their embarrassment for completely misjudging the global recession and their wrongheaded opposition to [stimulus], they now seek to resurrect a John Howard-style scare campaign on interest rates.''

Mr Swan said that "We're not going back to an era of cheap money,''

"We have to price risk appropriately,'' he said.

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