"Interest rates have today hit a 15-year high with one and maybe two increases to come in the foreseeable future, which will distress business owners and households and will clearly further impact business and consumer confidence and spending," said Innes Willox, Chief Executive of the national employer association, Australian Industry Group.
"We now face unenviable economic circumstances: no-one wants to see rate rises at a time when the economy is expected to slow. But the RBA faces little choice, with inflation running far too hot due to the absence of meaningful productivity growth for several years.
"This makes seriously tackling our declining productivity levels, including through significant tax and regulatory reform, a national priority.
"Coupled with the need to rein in government spending at federal and state levels, we have to act now to improve our prospects and prosperity.
"We still have a choice – to curl up into a fully-fledged welfare state mired in mediocrity or to flick a switch to become more dynamic, innovative and ambitious to lift living standards and improve business conditions.
"Today's rate rise, the fourth this year, is a warning that the window to make that choice is rapidly narrowing," Mr Willox said.
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