There is no justification for an early interest rate rise because it could choke increasing business confidence, the Australian Chamber of Commerce and Industry (ACCI) says.
Economists see a risk of the Reserve Bank of Australia (RBA) lifting the cash rate by 25 basis points from its "emergency" level of 3.0 per cent at Tuesday's monthly board meeting.
RBA Governor Glenn Stevens has repeatedly warned that the central bank won't keep the cash rate at a 49-year low longer than necessary.
But ACCI director of economic and industry policy Greg Evans believes there is no need to move pre-emptively at this stage.
"We don't want to see an early increase that potentially chokes off the increasing levels of confidence amongst business," he told reporters in Canberra.
Business wanted to see the economy exhibiting signs of strength without the support of stimulus measures that have been directed at consumer spending, housing and business investment.
"We are still concerned about some potential fundamental weakness in the economy, and overall demand and conditions," Mr Evans said.
© 2009 AAP
