Australian PM sorry for rate hike to 11-year high

---

SYDNEY, Nov 7 (AFP): Australian Prime Minister John Howard, who is fighting to save his job in upcoming elections, apologised to voters today after the central bank hiked interest rates to an 11-year high.
The unprecedented timing of the rate rise was a bombshell for Howard as he struggles to catch up on the resurgent opposition weeks ahead of the November 24 legislative elections.
He won the last election in 2004 on a promise to keep interest rates low, only to see the independent Reserve Bank raise them six times since. The latest hike saw rates rise 0.25 points to 6.75 per cent.
Howard immediately moved to placate the mortgage-belt voters whose vote is regarded as key to deciding the polls, but whose finances have been stretched as rates edge ever higher.
"I would say to the borrowers of Australia who are affected by this change that I am sorry about that and I regret the additional burden that will be put upon them as a result," he told reporters.
The widely-predicted rise, aimed at curbing inflationary pressures, is the first ever hike during a general election campaign.
The Reserve Bank said the raise was necessary after stronger-than-expected prices data in the last quarter showed that inflation would break out of its 2.0-3.0 target band by March if no action was taken.
Economists predict at least one more rate rise, given the strength of the economy and the rising pace of inflation, possibly as early as December.
The government has campaigned hard on the slogan "Go for growth," but the downside of expansionary policies has been a surge in inflation.