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Thursday, 8 December 1960

Mr CAIRNS - My question is addressed to the Treasurer, and arises from the statement he made a few minutes ago in answer to another question, to the effect that in consultation with the Governor of the Reserve Bank he had been informed that there would be an increase in the interest rate paid to depositors in savings and other banks. I now ask the right honorable gentleman: Will this not make it inevitable that there will be an increase in the interest rate charged by those banks to people who borrow from them, so that the increased cost to the banks resulting from the increase of the interest rate paid to their own depositors can be met? If this is so, is it likely that this increased interest charge made by the savings and other banks to building societies and others will be made before the end of this year, or will it be made six months after the decision, as in the case of the horror budget of 1951, or in March of the year following, as in the case of the little horror budget of 1956?

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