THE NEWS WRAP: Westpac expects further interest rate cuts

Westpac has said that it expects the Reserve Bank of Australia to further trim interest rates when it convenes tomorrow, with rates anticipated to drop to 3.5%.

Bill Evans, Westpac’s chief economist, said that he also expects rates to be cut in July and August, with a further cut later this year.

Meanwhile, Evans predicted that the Australian dollar will fall back to around 96 US cents by September.

Warning for online shoppers

Consumers have been warned that they face “severe’ penalties if they make use of loopholes to avoid paying tax on online purchases from foreign websites.

Some overseas retailers are offering fake invoices to allow consumers to avoid GST and import duties on purchases over $1,000.

However, Customs and Border Protection has warned that anyone caught doing this risks a $110,000 fine.

US unemployment rises

Unemployment in the US has taken a surprise leap, with the jobless figure rising for the first time in a year, to 8.2%.

The US Labour Department says businesses added 69,000 jobs last month, the lowest level since May last year.

Markets

The Dow Jones Industrial Average fell 274.88 points, or 2.22%, to 12,118.57 on Friday. The Australian dollar dropped down to US97 cents.