Mining industry masking need for rate cut

Simon Parker

The Reserve Bank of Australia (RBA) must cut interest rates to help support ailing sections of the local economy that employ large numbers of Australians, the head of Professionals Real Estate Group said.

“RBA Governor Glenn Stevens has pointed out that there are differences in the performance of Australia’s industry sectors and he wants more information before taking the next step,’’ said Glyn Morgan, chief executive officer of the Professionals Real Estate Group.

“I am saying that he could walk into any local real estate agency or the local shop and he could quickly find out what the problem was.

“The whole thing comes down to consumer confidence and it is falling again.

“We are in a position where those two per cent of the Australian population who are in the mining industry are doing very nicely thank you very much while 31 per cent of the population (accommodation and food services, 11.3 per cent; retail, 11 per cent; and construction, nine per cent) are worried about their futures.”

Mr Morgan said the problem was particularly bad in the tourism hotspots such as Gold Coast, Sunshine Coast, Cairns and Port Douglas.

“Our tourism industry is hurting badly and that in turn is hurting other industries in these regions,’’ he said.

“I understand that the RBA has to view the economy as a whole but the two speed economy has left the nation divided between winners and losers.

“Nationally the retail sector nationally is now hurting and more and more problems are emerging.

“I think if you speak to most people on the street, you find that they are a lot worse off now than they were at the beginning of 2008.

“This is despite the fact economists and the Reserve Bank say the economy is travelling relatively well.”

 

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