RBA Rate Cut Must be Fully Passed on by Banks
The building and construction industry has welcomed the Reserve Bank’s reduction in the official cash rate of 25 basis points and called on commercial banks to pass the cut onto their consumers.
Chief Executive of Master Builders Australia, Wilhelm Harnisch, praised the Reserve Bank’s sensible and precautionary approach.
“Today’s decision to lower the official cash rate is welcomed by the building industry, which is experiencing a prolonged downturn in activity.
“By cutting rates, the Reserve Bank is endeavouring to strengthen Australia’s non-mining sectors of the economy, particularly dwelling and non-dwelling building as the resources boom starts to level off. It’s now up to the commercial banks to do their bit and pass on these rate cuts, in full, to their customers, small businesses and homebuyers, to help stimulate the economy.
“Builders across the country are reporting high levels of consumer caution and it is hoped that lower interest rates provide the incentive to kick start new home buyer action.
“After keeping some of the previous rate cuts to themselves, there is no justification for banks not to pass these cuts onto consumers,” Mr Harnisch said.