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One thing is certain; we won’t get an interest rate rise next month because the Reserve Bank board meets on April 1 and would anyone there want to be known for saying ‘April Fool’ to millions of Australian mortgagees by increasing interest rates to 7.5%?

Australian shares finished flat after trading in positive territory for most of the day, as banking stocks followed the downward lead from Wall Street.

Here’s something the Reserve Bank board meeting will look at and have a little shudder as it considers the size of the interest rate rise today.

Tomorrow’s National Accounts for the December quarter look like being a bit mixed, if the business indicators for December released yesterday by the Australian Bureau of Statistics are any guide.

The big share market sell off ran out of puff in the US overnight, where it started on Friday.

The Reserve Bank revealed this afternoon that the board had decided to boost the cash rate by 0.25% for the second month in a row, “to contain and reduce inflation over the medium term”.

Australian shares fell by 0.5% for the fourth consecutive day as credit market worries continue to grip investor sentiment.

The Australian Bureau of Statistics (ABS) revealed today that growth in retail spending was flat in January as shoppers began to curb spending due to rising interest rates and the global credit crunch.

The key event for all local markets this week is the Reserve Bank board meeting tomorrow and subsequent rate decision at 2.30 pm.

Not even the sage of Omaha, Warren Buffett, could escape the impact of the subprime crisis, credit crunch and slowing economy in the last quarter of 2007, and although the year as a whole was another when his Berkshire Hathaway company outperformed the broader market as measured by the S&P 500.

A big week for commodities last week as yield and profit hungry financial investors continue to pile into the sector desperate for performance after the disasters of credit markets.

The December half profit reporting season finished Friday, except for some stragglers today and tomorrow like transport group, Asciano which is out today and could see the debt-ladened stock become the latest fancy of hedge funds and other speculators looking for a quick profit.

The Australian sharemarket tumbled by as much as 3% on Monday on the back of growing concerns about the US economy as well as the much anticipated interest rate rise tomorrow.

Small capitalisation company, Staging Connections (STG) was amongst a number of businesses rushing in to disclose their interim results after the last day to lodge ended on Friday.

The Aussie dollar is off again, charging towards parity with the sinking US dollar (or is it more a case of the US dollar falling towards us?)

I suppose any straw is better than no straw at all and that’s what some of the few remaining optimists among US economists and commentators were grabbing for yesterday with confirmation the US economy had not improved in the December quarter.

So with investment booming, the housing industry has been left behind, as we have seen in the building approvals for December and in the detail in the housing finance statistics.

Not only is the Aussie dollar soaring again (see story below) because of rising commodity prices, but it’s also reflecting higher interest rates, which in turn are reflect the Reserve Bank’s attempts to slow a booming economy.

Aussie stocks fell more than 1% today, pulled down by a weak lead from Wall Street, the banking sector and investor concerns about the Reserve Bank’s meeting next week.

Sometime in the next 24 hours figures will be released in the US confirming that the country has fallen into the grip of stagflation.