An official interest rate rise on Tuesday would "punch a hole" in business and consumer confidence, the Australian Chamber of Commerce and Industry has warned.
The chamber's latest expectations survey, released on Monday, again highlighted the pressures businesses are facing, it said.
An interest rate rise appears to be a slim possibility following last week's stronger-than-expected inflation numbers, although most economists expect the Reserve Bank to keep the cash rate at 4.75 per cent for now.
"We are particularly concerned about a pre-emptive rate increase, or an early increase," the chamber's director of economics and industry policy Greg Evans told reporters in Canberra.
"That that could be very damaging and punch a hole in both business and consumer confidence."
The Reserve Bank should hold off increasing rates until it received a better gauge on what is happening in the economy, Mr Evans said.
"We don't think they will be able to do that until they see the GDP (gross domestic product) numbers for the June quarter."
The national accounts that includes the GDP outcome in not released until September 7, the day after the Reserve Bank's September board meeting.
The chamber's latest survey showed its general business conditions index fell to 47.2 in the June quarter from 48.4 in the previous three months.
The index remained below the critical 50 level that separates expansion from contraction.
The deterioration comes against the backdrop of continuing speculation about interest-rate increases and new taxes, and an appreciating Australian dollar, Mr Evans said.
Nearly all components of the index declined in the June quarter, including sales revenue, profitability, investment and employment.
Notably sales and profitability were at contractionary levels.