The Rudd government has been labelled 'gutless' for not pushing the banks to pass on a predicted half a percent interest rate cut today in full.
The Reserve Bank is tipped to cut the official cash rate by up to 50 basis points.
Opposition leader Malcolm Turnbull has told 2GB’s Alan Jones, the government should be pressuring the banks to do the right thing by their customers.
“The government has just missed the point,” he said.
“The government has been hopelessly out of touch. I think they are certainly gutless on this issue and they were gutless at the beginning of the year.
“The Prime Minister seems to be presenting himself as the leading apologist for the banks. What he should be saying is: ‘I am standing up for all Australians.’”
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Homebuyers will almost certainly receive some interest rate relief today, with the Reserve Bank expected to cut rates by as much as half a per cent.
The RBA is likely to follow up last month's interest rate cut with another one following its meeting today.
Economists believe the cash rate will be slashed by between 25 and 50 basis points.
But home buyers aren't likely to receive the full rate reduction, with banks saying they can’t afford to pass on the entire cut because the global financial crisis has pushed up borrowing costs.
The Rudd government agrees, urging banks to pass on only as much as they can afford.
CommSec economist Sevanth Sebastian says it's the right time for a cut.
“It is good news that rates have peaked and are working their way down. For the Reserve Bank at the moment, certainly inflation is well above the target rate, but it is moderating quite significantly.
“For the Reserve Bank it’s all about growth now, ensuring the Australian economy remains buoyant, remains strong, and to do that rates need to make their way lower.