Interest rates are where they should be, RBA says

The leader of the Reserve Bank of Australia (RBA) has insisted that current interest rates across the country are just about fair.

Some economists and retailers had hoped that the organisation would lower the standard rate by a further 25 basis points in February, but this did not happen.

Instead, the RBA kept the rate at 4.25 per cent and some banks saw this as an opportunity to raise their own rates, much to the frustration of their customers.

However, the Australian Associated Press reports that RBA governor Glenn Stevens has indicated that he would rather see profitable banks than unprofitable ones.

"Overall, as of present, it is about where we should be," he was reported as saying.

"These rates are roughly where we think is appropriate for the circumstances we face," Mr Stevens added.

The RBA chief also stated that Australia should look at the current problems in Europe to see how damaging struggling banks can be to the overall economy.

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