Businesses tell PM they want interest rate cuts

Businesses are desperate for the Reserve Bank of Australia (RBA) to sanction further cuts to interest rates.

Despite making two reductions towards the end of 2011, the central bank has been reluctant to make any more amendments this year.

Indeed, many economists had expected another cut in February and March, but this did not happen and plenty of companies are feeling the pressure as a result.

Speaking to ABC Radio, prime minister Julia Gillard said the RBA will have an opportunity to bring in lower interest rates as long as the country achieves a surplus on its budget in May.

"Australian businesses, many of them doing it tough because of the strong Australian dollar, have said to me that they would like to see an interest rate cut," she was reported as saying.

Ms Gillard also noted that achieving a surplus will send out a message that the Australian economy is strong and this will hopefully boost the confidence of companies down under.

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