Let's put to rest the claim that the IR laws or any wage pressure was responsible for this interest rate rise (and the previous ones since the IR laws were introduced).
Here is the man, responsible, giving his reasons for the interest rate rise. Note this part: "Growth in labour costs have been contained so far".
That gives the lie to Rudd's claim that IR Laws or a wages breakout is responsible for the rate rise. If you read the rest it is the sheer strength of the economy driven primarily by China's and other Asian nation's appetite for our resources.
Rudd knew all that before he made his statement about the IR laws:
Date: 7 November 2007
STATEMENT BY GLENN STEVENS,
GOVERNOR
MONETARY POLICY
"During 2007, the pace of growth of demand and output has also increased. There are few signs of that strength diminishing as yet, and reports of high capacity usage and shortages of suitable labour persist. Growth in labour costs has been contained so far, and high levels of investment are adding to productive capacity in some sectors."
"The world economy is still expected to grow at an above-average pace, however, led by strong growth in China and other parts of Asia. High global commodity prices remain an important source of stimulus to Australian spending and activity."
So it's obvious that wages pressures and certainly not the implementation of the IR laws had anything to do with this rate rise.
Thus Kevin Rudd had, not read the statement from the reserve, did not understand what it meant or was deliberately misleading the willing.
Now back to your understanding of how IR laws could impact on interest rates.
The first question you need to ask yourself is this: Is a reduction in worker's wages likely to put an upward pressure on interest rates?
Once you've sorted that one out ask your self this question: Are worker's wages likely to increase or be reduced under Work Choices?
Now see if Rudd is not only misleading in not accurately conveying the RB's rationale but dishonest in that he claims Work Choices will reduce worker's wages but also that reduction has fueled inflation which in turn has resulted in the decision of the RB to raise interest rates.
You may be able to explain this seemingly miraculous association. If so inform me how it works
