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MELBOURNE - An interest rise is inevitable next month, says Wizard Home Loans founder and chairman Mark Bouris while ANZ chief executive John McFarlane thinks it's a 50-50 proposition.
With the Reserve Bank of Australia's next monthly meeting on February 6, McFarlane said yesterday that he saw no compelling reason for rates to rise.
However, Bouris is tipping a quarter of a percentage point rise.
"I think the Reserve Bank, if the numbers come in, if the underlying inflation comes in at what the expectations are, the Reserve Bank will make a move," Bouris said.
"It's going to be tough, I'm sure it will be, but that's only a very small proportion of the mortgage environment."
A February rise would be the last for the year, he said. "You know the whole thing's designed to stop people from spending. That's what monetary policy's about. And I think it will do that."
But McFarlane, speaking at the reopening of ANZ's banking museum in Collins St, Melbourne, said there was no compelling reason to lift rates.
"Analysts and economists are mixed on this, but my own sense is that it's not particularly compelling, not urgent," he said.
"Obviously the Reserve Bank will act in the event if inflation is systematically outside its target range - which it has not been."
- AAP