Pressure grows on Reserve Bank to cut interest rates

The Reserve Bank of Australia (RBA) is coming under mounting pressure to make further cuts to interest rates.

Australia's manufacturing sector has been blighted by the high Australian dollar in recent months and a number of jobs have been shed in the car making industry, the Herald Sun reports.

Toyota was forced to trim its workforce by 350 this week (January 23rd) and other firms are also struggling to compete with overseas producers who can create vehicles far more cheaply.

The RBA has already reduced interest rates by 0.25 per cent in both November and December and some experts are adamant that further adjustments will be made next month when the board meets for the first time in 2012.

Chief economist at the Australian Chamber of Commerce and Industry Greg Evans told the news provider that the government must do more to relieve the stress on the sector.

Senior economist at Macquarie Brian Redican recently told the Australian Associated Press that more Aussies will buy homes this year, as reduced interest rates are making mortgages more attractive.

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