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Interest rates rise not good for print – Hagop’s commentary

Wednesday, 15 August 2007
By Print 21 Online Article

Increasing from 0.25 percentage points to 6.50 per cent, interest rates are now at the highest level in almost a decade. The Reserve Bank justified the decision to lift interest rates by stating that economic data in recent months have signalled a pick-up in the pace of growth in demand and activity. Unemployment has continued to trend down and capacity utilisation remains high.

Printing Industries national policy and research manager, Hagop Tchamkertenian, said interest rates rises are always met with dismay in the printing industry.

“The Reserve Bank has once again displayed by its decision today that it remains committed to controlling inflation and that it is prepared to take tough decisions even when we are so close to a federal election,” he said.

“The printing industry services sectors of the economy that are sensitive to movements in interest rates such as the retail industry. When interest rates rise and these sectors feel the impact the printing industry also naturally suffers as a consequence”.

Hagop said that operators in the printing industry must now adjust to this new reality by emphasising the vital role marketing and communications plays even when the economy starts to slow down.

“The smart companies do not cut back on their advertising expenditure just because the economy starts to slow down,” he said. “They continue to advertise and promote their products and services in an attempt not only to maintain but to also increase market share. This is the message that printing organisations need to convey to their clients.”

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