Banks must follow RBA moves: Swan

Treasurer Wayne Swan says there's no excuse for banks not to cut rates if the Reserve Bank does next week.

The RBA's widely tipped to cut rates next Tuesday – Melbourne Cup day.

If it does it would be the first cut in two and a half years.

Mr Swan's refused to comment on any rates movement but has told ABC radio the Reserve Bank's made it clear the board believes there's room to move.

The RBA has kept the cash rate at 4.75 per cent since November 2010.