Fed: Little chance of interest rate rise this week - economists

AAP General News (Australia)
04-05-2004
Fed: Little chance of interest rate rise this week - economists

Homebuyers can look forward to the Easter break with little chance of an interest rate
rise at tomorrow's Reserve Bank meeting -- and maybe for the rest of the year.

In a rare interview, Reserve Bank boss IAN MACFARLANE has sparked speculation that
political considerations in the lead-up to the federal election, due later this year,
may stay the bank's hand.

Mr MACFARLANE says the 2001 election had a small influence on the Reserve's decision
to cut rates that year and it would take a strong case to raise rates in an election year.

He's made the comments in University of Queensland assistant professor STEPHEN BELL's
new book Australia's Money Mandarins.

Some analysts say the combination of the federal Budget in May and an election as early
as August means tomorrow's Reserve Bank board meeting could be the last politically-feasible
time for a rate hike.

AAP RTV kmh/sb/wjf/rp

KEYWORD: ECONOMY (CANBERRA)

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