RBA interest rate

RBA governor Philip Lowe announced a 0.5 percentage point increase in the cash rate to a higher than expected 0.85 per cent.

“Consumers are especially pessimistic about the current economic outlook and their current financial circumstances,” he said. “While inflation is lower than in most other advanced economies, it is higher than earlier expected,” he said. There was a 4.7 per cent decline in whether it was a good time to buy a major household item after a jump of 10.1 per cent in the previous two weeks. That was the first time the bank had intervened during an election campaign since 2007, but the RBA had flagged it was the start of a series of rises as it returns rates to a “more normal” level. It’s the biggest one-month increase in the official cash rate since February 2000 and only the second rise since November 2010, after the bank last month lifted the cash rate from a record-low 0.1 per cent to 0.35 per cent in the lead-up to the federal election. The Reserve Bank has made the biggest one-month increase in official interest rates in more than two decades in a bid to address higher than expected inflation.

Jim Chalmers responds to Reserve Bank decision to lift cash rate 50 basis points as Anthony Albanese declines to comment during Indonesia trip.

“This is not the challenge that we have in the economy. The submission noted “highly unusual and challenging economic conditions” in Australia and the 5.1% rate of inflation. It will take more than two and a half weeks to turn around.” “We need to be honest and upfront with the Australian people about the nature, the severity, the magnitude of this inflation challenge that we confront,” Chalmers said. “It is within our grasp, it is within our reach to strengthen our economy and have a better future, but first we need to navigate together this high and rising inflation and the interest rate rises that accompany it.” “The truth is that we have an incredibly difficult combination of challenges,” Chalmers said.

The number of Australians suffering “mortgage stress” is set to skyrocket in the wake of today's interest rate hike, with home loan repayments tipped to ...

“The reason we have volatile housing markets is that we don’t have a good policy which is why we need the government to develop a national housing strategy – which they have committed to do,” she said. “These figures are showing that people will have to cut back on expenses because their budgets will be really stretched – and that will flow on to the economy.” “That trend makes people very vulnerable to these interest rate rises and means these developments are going to cause a lot of pain in a lot of communities.” “People who have brought more recently have been paying a lower interest rate for the length of their mortgage so this will be a big step up,” she said. “Stress is surprisingly high in those affluent suburbs too which reflects the fact that to buy a property in Sydney or Melbourne now, people need to stretch themselves significantly,” Ms Colvin said. The number of Australians suffering “mortgage stress” is set to skyrocket in the wake of today's interest rate hike, with home loan repayments tipped to rise again for the second time in as many months.