The government and the big four banks had been primed and ready for a fight, with Labor politicians ready to demand the banks pass the rate cut to borrowers, and the banks ready to argue that they couldn’t afford to do so.

Yesterday, as the deadline approached for the Reserve Bank decision, the Australian Bankers Association and its allies were mounting the curious argument that politicians should desist from airing their views on banks because these, if negative, might discourage foreign investors and cause national harm.

A related argument suggested that it was in the national interest for banking profit margins to be protected, since a decline in profits might spook lenders to banks and prompt them to demand higher rates for their deposits and loans.

While nobody would deny that a healthy banking sector is a good thing for any country, the ideas that governments and politicians should suppress their opinions and give special consideration to bank profits when espousing policy hardly stand scrutiny.

In fact, some might see them as unwelcome extensions of the ‘‘too big to fail’’ doctrine that implies banks must be rescued, with taxpayer funds when necessary, from their own bad business decisions because letting them go broke might ruin the nation.

Australia’s banks, having in recent years experienced unprecedented profitability, now confront two separate business challenges. Their cost of funding has increased, especially since they must refinance short-term overseas money in an uncertain climate or replace it with domestic deposits or bond issues.

At the same time, demand for loans has dropped, with many consumers trying to shed debt, rather than take more on.

Together these factors seem likely to add up to reduced profits for the banks, a prospect they – like any other business in a similar position – will hardly relish.