Interest rates: who’s to blame?
Wayne Swan went on the front foot this afternoon in response to the 0.25 per centage point interest rate rise the RBA has just announced.
Before Joe Hockey could race to the back of the NSW Parliament to accuse the Government of being responsible for the rise, Mr Swan predicted he and Malcolm Turnbull would try to pin it on him and the Prime Minister.
“Never forget that if the Liberal Party has their way Australia would be in recession right now,’’ Mr Swan said. ``For the Liberal Party to claim now that interest rates can stay at record lows is simply laughable and demonstrates their lack of any economic credibility whatsoever.”
He went on: “Clearly commonsense will tell you that as the economy begins to recover, the Reserve Bank will exercise its independence and move rates accordingly.”
Joe Hockey took the bait.
“The Rudd government was always quick to claim credit for decreases in interest rates,’’ Mr Hockey said. ``Now it has to accept, sadly, responsibility for increases in interest rates. It’s reckless spending has had a direct impact on the interest rate increase ahead of market expectations today.”
But how much does the Government really have to do with the Reserve Bank’s decision-making?
Is it empty posturing from the Opposition to say rates going up is the result of the Government’s stimulus spending?
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