Interest rate rise

With unemployment at 4 per cent and inflation over 5 per cent, keeping official interest rates near zero is no longer justified.

But debt as a share of household income has risen sharply since the previous phase of interest rate increases, which began in 2009, and that has made borrowers much more sensitive to rate rises. The RBA asserted that independence in November 2007 when its board opted to lift rates during a federal election campaign. This unfortunate contradiction between fiscal policy and monetary policy is now playing out in the middle of an election campaign. Given the strong arguments supporting a lift in interest rates, and the persistent debate about household cost-of-living pressures, the public expects action. The central bank’s board will have understandable concerns about moving the cash rate during a federal election campaign. A gradual return to more-normal interest rate settings is in Australia’s interests.

US stocks end higher after a volatile trading session, the Reserve Bank meets today to consider raising interest rates to curb surging inflation, ...

Westpac's Imre Speizer said in a research note that the bank predicted the RBA to raise interest rates today by 0.15 per cent to 0.25 per cent, which is also the market's forecast. Earlier in the session, Brent and West Texas Crude fell on the news that the European Commission may spare Hungary and Slovakia from a Russian oil embargo as it prepares to finalise its next round of sanctions on Russia. "The AGL Energy demerger is on track to be completed by the end of next month," the spokesperson said. The Australian dollar fell 0.2 per cent to 70.49 US cents, with the greenback approaching a 20-year high against a basket of currencies before the expected rate increase this week by the Fed. Official rates were slashed to a record low of 0.1 per cent in 2020 as an emergency response to the coronavirus pandemic. Yesterday, the ASX 200 index fell 1.2 per cent to 7,347. The Reserve Bank is tipped to raise interest rates later today for the first time in 11 years to curb surging inflation, which is running at an annual rate of 5.1 per cent. The Fed meets this week and is expected to raise interest rates by 50 basis points, to 0.75 per cent to 1 per cent, to tackle the strongest price rises in 40 years. The central bank last raised the official cash rate by 0.25 basis points (0.25 per cent) in November 2010, which took the OCR to 4.75 per cent. By the close, the Dow Jones Industrial Average rose 0.3 per cent to 33,062, the S&P 500 gained nearly 0.6 per cent to 4,155, and the Nasdaq increased 1.6 per cent to 12,536. The benchmark S&P 500 rebounded after dropping to the lowest since May 2021, and the Nasdaq fell to the lowest since November 2020 during the session. - The Dow Jones index rose 0.3pc to 33,062, the S&P 500 rose nearly 0.6pc to 4,155, and the Nasdaq rose 1.6pc to 12,536

With unemployment at 4 per cent and inflation over 5 per cent having official interest rates near zero is no longer justified.

But debt as a share of household income has risen sharply since the last phase of interest rate increases, which began in 2009, and that has made borrowers much more sensitive to rate hikes. The RBA strongly asserted that independence in November 2007 when its board opted to lift rates during a federal election campaign. It is more than 11 years since the last official interest rate increase in Australia; many with a mortgage have never had to confront the prospect of higher borrowing costs. This unfortunate contradiction between fiscal policy and monetary policy is now playing out in the middle of an election campaign. Given the strong arguments supporting a lift in interest rates, and the persistent debate about household cost of living pressures, the public anticipates action. A gradual return to more normal interest rate settings is in Australia’s interests.

Australians will end up paying more on their mortgage each month with the Reserve Bank of Australia's antic...

It is likely to mean their interest rate will increase, meaning the cost of your loan will go up," she said. The information has been prepared without taking into account your personal objectives, financial situation or needs. The information provided on this website is general in nature only and does not constitute personal financial advice.

Economists are generally convinced the Reserve Bank of Australia will lift the cash rate at Tuesday's monthly board meeting, which would be the first ...

See SUBSCRIBE at the top of this article “That is what I am concerned about. Want to stay on top of local happenings? An initial rate increase of 0.15 per would add around $45 per month to repayments on a $500,000 variable mortgage, but would rise by around $350 per month if the cash rate rose to 1.25 per cent by year end as some economists are predicting. Financial markets are fully priced for a 0.15 per cent rise in the cash rate to 0.25 per cent and is expected to be followed by increases of 0.25 per cent in subsequent months. Economists are generally convinced the Reserve Bank of Australia will lift the cash rate at Tuesday’s monthly board meeting, which would be the first increase in more than a decade.

All eyes are today focused on the Reserve Bank of Australia, with it expected to increase interest rates on Tuesday afternoon – and some economists are ...

This was the largest quarterly and annual rise since the introduction of the goods and services tax (GST) in 2000. Some experts have predicted the interest rate could even reach 2.5 per cent by the end of the year. The latest Consumer Price Index (CPI) released last week from the Australian Bureau of Statistics (ABS) revealed the CPI rose 2.1 per cent in the March 2022 quarter, and 5.1 per cent annually. New to Flash? Try 1 month free. Stream more finance news live & on demand with Flash. 25+ news channels in 1 place. Three of the big four banks – ANZ, NAB and Westpac – have tipped interest rates to increase to 0.25 per cent in May, with Commonwealth Bank predicting the RBA will hold off until after the federal election with a June 0.15 rate hike.

There's a lot of talk about interest rates going up - but how much will it actually affect you?

“I mean, sometimes you guys (journalists) always see things through a totally political lens. “But raising the cash rate 18 days before an election - the first hike in over a decade - would put the RBA right in the political mix.” Should the RBA increase the cash rate on Tuesday, it would mark the first time in a decade. According to home loan rate change calculator Mozo, someone with a principal-and-interest loan of $500,000 with 25 years remaining would be paying $40 a month more on their mortgage if the RBA increased the cash rate by 0.15 per cent, their bank’s interest rate going from 3.1 per cent to 3.25. ANZ was the first of the big four banks to call for a cash rate hike. The RBA uses interest rates to manage the rates of inflation.

The Reserve Bank is widely expected to lift interest rates today, the majority of Australians believe they're doing their bit on climate change but want the ...

Hanson Young said a minimum performance fee was “the least the government can do” to provide ongoing support for the arts sector. Greens leader Adam Bandt has called for a government-backed $250 minimum performance fee for artists and the creation of a $1 billion live performance fund to support the arts sector. The MEAA campaign for a minimum support fee for musicians has been endorsed by Labor state governments in Victoria, Queensland, Western Australia and South Australia.

Interest rates are likely to rise when the Reserve Bank of Australia holds its monthly board meeting on Tuesday, with Prime Minister Scott Morrison saying ...

"Now Australians know that there are pressures on interest rates, that's why many of them, so many of them have been switching to fixed rates. Stream more election news live & on demand with Flash. 25+ news channels in 1 place. New to Flash? Try 1 month free. "What happens tomorrow deals with what people pay on their mortgages, that's what I'm concerned about, it's not about what it means for politics. I mean sometimes you guys always see things through a totally political lens. Interest rates are likely to rise when the Reserve Bank of Australia holds its monthly board meeting on Tuesday, with Prime Minister Scott Morrison saying the decision is "not about politics".

The federal government is playing down the political impact of a potential central bank interest rate rise - the first in 12 years - ahead of the May 21 ...

“When things are going well in the economy Scott Morrison takes all the credit, but when Australians are doing it tough he takes none of the responsibility.” “It’s important that they [the RBA] apply the monetary policy settings in an independent way and in a way that acts in concert with what we’ve been doing in relation to fiscal policy,” he said. “I don’t think that Australians expected interest rates to stay at historically low 0.1 per cent levels forever,” he said on Tuesday. “Australians are focused on what they are paying for and who they think is going to be best able to manage an economy and manage the finances, so they are in the best possible position to realise their aspirations.” Asked if rising rates could damage the coalition’s chances at the federal election on May 21, Morrison accused journalists of looking through a “totally political lens”. “They know there are (inflation) pressures that are coming from outside of Australia on interest rates,” he said on Monday.

It's almost certain interest rates will rise on Tuesday — this is how much extra you could be paying if the experts are correct.

Mr Oliver thinks banks will pass on the full amount of any rate hike. New to Flash? Try 1 month free. Stream more finance news live & on demand with Flash. 25+ news channels in 1 place. There is a general consensus the RBA will at least increase rates by the amount of the last rate cut, which was 0.15 percentage points. Mr Oliver believes rates could be 1.5 per cent higher by the end of the year, and 2 per cent higher by mid next year. The RBA is expected to announce its decision on the cash rate on Tuesday, around 2.30pm.

The Coalition is playing down the political impact of a potential interest rate rise, as Labor steps up its attack on Scott Morrison's economic credibility.

"If something good happens in the economy the prime minister takes credit. "If something good happens in the economy the prime minister takes credit. The prime minister is campaigning in the outer Melbourne seat of Dunkley on Tuesday, while Labor leader Anthony Albanese is campaigning on the NSW central coast. "The prime minister wants to pretend that he has absolutely nothing to do with it," he told the Seven Network on Tuesday. If something difficult happens in the economy he takes none of the responsibility, and I think Australians are tired of that." But Mr Albanese said it was "extraordinary" for the prime minister to claim rising inflation and interest rates had nothing to do with politics. The prime minister is campaigning in the outer Melbourne seat of Dunkley on Tuesday, while Labor leader Anthony Albanese is campaigning on the NSW central coast. "The prime minister wants to pretend that he has absolutely nothing to do with it," he told the Seven Network on Tuesday. "Australians know the pressures that we're facing here in Australia are real and they are overwhelmingly being determined by things beyond Australia," he told reporters in Melbourne on Tuesday. If something difficult happens in the economy he takes none of the responsibility, and I think Australians are tired of that." But Mr Albanese said it was "extraordinary" for the prime minister to claim rising inflation and interest rates had nothing to do with politics. "Australians know the pressures that we're facing here in Australia are real and they are overwhelmingly being determined by things beyond Australia," he told reporters in Melbourne on Tuesday.