Banks Raising Rates, yet RBA wants to lower?

[Slade]

Looks like there is a battle between the RBA and the major Australian banks, as written in this article - RBA may have to cut rates again | Money | News.com.au (http://www.news.com.au/business/money/story/0,28323,25636957-14327,00.html)

The only way the RBA can attempt to curve the big banks from raising their interest rates due to the cost of money to them is to decrease the rates again!

What do you think about this? Good idea.. bad idea? how are the rate rises affecting you personally?

[JamesGG]

Very shortsighted view by the RBA if they follow through with it.

That said, I think many of the media releases by the RBA are simple rhetoric. Talking about doing things often inspires much the same result as actually doing it, particularly when we're only talking about a small cut.

Of course, the reason why the banks are raising rates (or at least, the reason openly provided) is because of the higher cost of funding - this has little to do with the RBA in many cases because that higher cost of funding is due to currency risk and foreign investment; neither of which directly controlled by the RBA...