The housing industry has called on the RBA for bold action following benign inflation.
ABS figures released Tuesday showed a nominal 0.1% rise for the CPI in the March quarter, bringing inflation to 1.6% for the year. The result compares to the 3.1% inflation had tracked at in the December quarter.
In light of the benign result, the Housing Industry Association has called for drastic action when the Reserve Bank meets next week.
"The housing industry and wider Australian economy needs a further 75bps of interest rate cuts and there is nothing standing in the way of a 50bp move to get the ball rolling next Tuesday," HIA chief economist Harley Dale said.
Dale admitted that a 50bp cut would be a "bold move" for the Reserve Bank, but said it was appropriate given the speed of the economy. He admonished banks to pass on the full measure of any potential cuts.
"The banks need to follow suit and pass any rate cuts on in full rather than hide behind the fallacious
argument that higher funding costs somehow justify them holding some interest rate relief back," he said.
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