Rates could rise next week

The Reserve Bank board meets next week for its October meeting and could lift rates say economists. If there is no rate rise in October, many economists believe that the RBA will raise rates by the end of 2009.

The Reserve Bank governor Glenn Stevens said yesterday that unemployment is expected to peak soon, at a much lower rate than previously feared. Mr Stevens comments have been widely interpreted as meaning that the central bank is preparing to raise rates soon.

Mr Stevens told a Senate inquiry into the economic stimulus that interest rates would need to rise to prevent unsustainable increases in house prices or other assets.

Source: Brisbane Times