The Fair Work Commission's decision to boost wages has many economists now expecting the RBA to raise rates again on Tuesday, but one financial commentator is urging decision makers to hold off until the effects of the change filter through the economy.
Veteran financial expert Peter Switzer is urging the Reserve Bank to"hold fire" on further interest rate rises until economic data on the effect of higher wages and inflation becomes available.
"I just think there's good reason for him to hold fire," he said on Monday, the day before the RBA is due to meet. "It is still worthwhile waiting to see the flow-through of that decision, but you're right," he said. The RBA is widely expected to increase rates when it meets on Tuesday following a decision by the Fair Work Commission last week to boost the minimum wage for thousands of Australians. Picture: Lisa Maree Williams/Getty Images
Meanwhile, Goldman Sachs and Capital Economics updated their predictions to a 4.35 per cent cash rate by July.
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