South West residents should buy local products and services and holiday within the region using the savings on their mortgage as a result of this week’s interest rate cut, according to outgoing Bunbury Chamber of Commerce and Industries chief executive Andrew Horan.
The Reserve Bank cut interest rates by .25 per cent on Tuesday, citing concerns about weak global growth forecasts — especially from Europe and China — and falling commodity prices in Australia. It takes the official cash rate to 3.25 per cent.
Retail executives and housing industry experts were confident the cut would boost consumer confidence and their discretionary spending allowances, should the banks pass on all or some of the cut.
‘‘Banks have their own businesses to run, but at the end of the day if their costs are lowered they should be passing that on to the consumer and the business community,’’ Mr Horan said.
‘‘If people have the capacity to reduce their debt they should, and if they have surplus funds then spending locally is important.’’
Bunbury Forum Shopping Centre manager Vern Merchant said the retail sector had been struggling for some time and the cut was welcome news.
‘‘It will be a windfall for customers and retailers leading up to Christmas,’’ he said.
‘‘I think the Reserve Bank has recognised where the economy is at and I think there will be further rate cuts coming in the next six months — it’s a gut feeling.’’
Master Builders Association regional manager Geoff Bosustow said the rate drop would set the building and construction industry on the right track.
‘‘Banks need to pass it on so the average consumer can gain confidence in the market,’’ he said.REIWA rural network chairman Don Fry said the cut would make the market better for buyers.