Swan tight-lipped on Govt's interest rate clout
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Federal Treasurer Wayne Swan is refusing to reveal what steps he will take if the banks do not pass on a future interest rate cut.
The Reserve Bank of Australia has signalled it may cut the official cash rate later this year.
Mr Swan has been pressuring the banks to follow suit but he will not say what he will do if they do not.
"If the banks fail to pass on an official rate cut, as they should, then there are a number of options open to the Federal Government, particularly when we're looking at the market and the extent to which it is competitive," he said.
"But I'm not going to flag them in advance, I expect them to do the right thing.
"I have been very puzzled as to why this debate erupted in the first place."
The Opposition's treasury spokesman, Malcolm Turnbull, says Mr Swan risks destroying his credibility by threatening banks over interest rates.
Mr Turnbull says the Treasurer is risking embarrassment.
"There is no better way to completely destroy your credibility than to make threats you can't carry out," he said.
"So if he's made that threat and he, one or other of the banks don't reduce their rates in line with the Reserve - any change with the Reserve Bank's official rate - and he's not able to do anything about it, he'll be exposed."
