Fed: Business confidence growing despite rates risk=2

AAP General News (Australia)
04-03-2007
Fed: Business confidence growing despite rates risk=2

Mr Hendy said in the May budget, the government needed to address the problem of finding
suitably qualified staff.

"It's more evidence to back up the business community's call ... that we think there
should be increased expenditure on education and training, particularly on the vocational
education area," he told reporters.

Mr Hendy said the government also needed to look at taxation issues like bracket creep
and the capital gains tax burden.

He also sent a message to the Reserve Bank board to think seriously about the impact
of an interest rate rise on business.

"The economy is on the improve and that weighs up on one side ... on the other side
though there is evidence that inflation is under control," Mr Hendy said.

"The survey we are releasing today showed us that expectations are for inflation to
ease over the year.

"The other thing is that the Australian dollar is at a very significant high, that
is hurting exporters. If interest rates were to increase this week we would see a further
potential increase in the dollar value and that would further impact exporters."

AAP so/sb/cp/de

KEYWORD: CONFIDENCE 2 CANBERRA

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