Tuesday, February 14, 2012

Reserve Bank fights back on interest rates; says it still pulls the levers on monetary policy

The Reserve Bank has downplayed suggestions that commercial banks are pulling the levers on interest rates.

RBA assistant governor Guy Debelle told a business function in Sydney that moves by the big four banks to lift their mortgage rates outside the central bank's cycle would not alter the influence of monetary policy on the economy.

Listen to my analysis from The World Today and see the story on ABC News Online.

There was an element of fight back in Mr Debelle's speech this morning, given suggestions that the banks were thumbing their nose at both the RBA and the Federal Government, with Federal Treasurer Wayne Swan pressuring banks for months not to lift their rates independently.

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