RBA interest rate

With today's back-to-back quarter point increases in the cash rate, the Reserve Bank signalled that it wasn't overly spooked by the September quarter CPI ...

This is exactly why inflation is the biggest challenge in our economy. Medium-term inflation expectations remain well anchored, and it is important that this remains the case. It’s the No 1 focus when it comes to the budget that we handed down last week. This is about another $50 a month on an average outstanding balance of $330,000. We knew when we put the budget together that inflation was high and rising, and that was bringing with it higher interest rates. And that was putting additional pressure on Australians with a mortgage. Australia was the first major nation to reduce the pace of interest rate rises in October when the Reserve Bank went with a 25bp hike after four 50bp rises in a row. That’s precisely why we took difficult decisions in the budget, showed spending restraint, put a premium on what’s responsible and affordable and sustainable. This is the seventh increase in a row and fact since May. That is a very significant increase they are paying for their groceries, for other household goods, and for fuel and electricity bills of course. So this is a challenging time for so many Australians. What might tilt the bank to go harder again?

The Reserve Bank lifts interest rates for the seventh month in a row, taking the cash rate to 2.85 per cent. Follow our live blog for the announcement and ...

And that's what our budget is," Chalmers says. The reason for the rise is inflation due to rising food cost and continued consumer spending probably rising more as Christmas approaches. It is therefore fiscally irresponsible to proceed with the Stage 3 Tax cuts in July 2024 increasing the money supply further fanning inflation. And the WA Government’s most recent budget had cost-of-living measures, like a $400 energy bill credit for households, which has kept inflation much lower over there. And for the last 12 months, Perth’s annual inflation, at 6 per cent, has been the slowest of any major city in Australia. The increase in RBA Official rate unfortunately makes it harder to those on low income who are already under stress from rising cost of living. The Equity Gap again widens between the haves and the have not. It will take time for businesses to adjust to a higher level of interest rates. That’s because there are lots of dynamics at play. So, the soaring property prices we’ve seen during the pandemic era (and more recently, the property price declines we’ve seen), aren’t considered inflation. By Shiloh Payne It will take time for households to adjust their spending behaviour to the higher rates.

The RBA has unveiled its seventh hike in interest rates since May as it battles rising inflation, lifting its target 0.25 percentage points.

New forecasts predict inflation will reach 8 per cent over the December quarter (up from 7.75 per cent), and will only fall to 4.75 per cent in 2023 (compared to 4.3 per cent forecast in August). The unemployment rate is also now tipped to rise above 4 per cent (currently 3.5 per cent) in 2024, while economic growth will be weaker too, with the latest GDP forecasts trimmed 0.2 percentage points in 2023 and by 0.8 percentage points in 2024. “While inflation pressures are expected to abate next year with the resolution of supply-side disruptions, the RBA look set to take further action to rein in demand.” The rate hikes are all part of an effort to bring down inflation, which reached 7.3 per cent in annual terms in the September quarter and is now tipped to peak at 8 per cent over the December quarter, before easing in early 2023. “The size and timing of future interest rate increases will continue to be determined by the incoming data and the Board’s assessment of the outlook for inflation and the labour market,” Dr Lowe said in a statement. “The average variable mortgage rate for a new owner occupier loan is set to reach approximately 4.96 per cent, up from the April low of 2.41 per cent,” he said. The RBA has already slowed the pace of rate hikes as the cash rate target has normalised, with Tuesday’s move being the second 0.25 percentage point rise in a row following five 0.50 percentage point rises. The Board remains resolute in its determination to return inflation to target and will do what is necessary to achieve that.” Tuesday’s move sets a new record for the most consecutive rate hikes in a row by the Reserve Bank and will further squeeze homeowners who are paying down variable rate mortgages ahead of Christmas holidays. The central bank is tipped to pass on another 0.25 percentage point rate hike in December, just as the inflation rate is expected to begin peaking. The move will add another $78 to typical monthly mortgage bills on top of the $731 that’s been piled on already as the cash rate has risen from a record low 0.1 per cent to 2.85 per cent – the highest in nearly a decade. The RBA also updated its forecasts for the economy on Tuesday, saying that inflation will now peak higher and take longer to fall than previously.

This afternoon the central bank lifted interest rates by 25 basis points or 0.25 per cent, taking the cash ...

Over the year to September, the CPI inflation rate was 7.3 per cent, the highest it has been in more than three decades," Lowe said in a statement. "The Board expects to increase interest rates further over the period ahead. The information provided on this website is general in nature only and does not constitute personal financial advice. The information has been prepared without taking into account your personal objectives, financial situation or needs. Throw in skyrocketing mortgage costs and it's a double whammy for families struggling to make ends meet," RateCity.com.au research director Sally Tindall said. "The Board has increased interest rates materially since May.

The Reserve Bank is expected to raise the official cash rate by at least another 0.25 percentage points, the electorate is divided over multi-employer ...

“I think this is an attempt to unionise certain private workplaces.” Steggall said the “trigger for this to occur” would be unions entering workplaces to engage staff over their new rights. [eight days after its introduction](/link/follow-20170101-p5bte8) – has inflamed tensions over the pace of the 249-page Secure Jobs, Better Pay legislation.

Reserve Bank raises rates for seventh time in attempt to bring inflation under control.

“It is very much consistent with the notion of ‘keeping the economy on an even keel’.” Banks such as the ANZ retained their forecast for how much higher the RBA would lift rates, leaving it at a predicted peak of 3.85% by next May. The pricing behaviour of companies will also be a focus. “Medium-term inflation expectations remain well anchored, and it is important that this remains the case.” The board expects to increase interest rates further over the period ahead.” The increase was in line with most economists’ expectations.

Jim Chalmers has warned Australians to prepare for inflation to get worse and interest rates to rise even higher before cost-of-living pressures recede.

“And that’s what our budget is. Mr Chalmers — who has previously framed inflation as Australia’s “public enemy no. Mr Taylor didn’t offer any concrete policies the Coalition would implement to put downwards pressure on inflation and interest rates if it were in government, beyond what he said was the need to “balance the budget”. “When inflation and interest rates are rising, it’s more important than ever that the budget is responsible, restrained, and right for the times,” he said. “Higher inflation and higher interest rates coming with it means that the pressure is coming on Australians from around the world,” Mr Chalmers said. “The board expects to increase interest rates further over the period ahead,” he said.

The Reserve Bank opts against a return to super-sized rate hikes, announcing a 0.25 of a percentage point rise on Melbourne Cup Day.

[official inflation figures from the Australian Bureau of Statistics](/news/2022-10-26/inflation-cpi-september-quarter-2022-abs/101578650) showed prices had jumped 7.3 per cent over the year to September. "We have pencilled in a total of 75 basis points of rate cuts by mid-2024, taking the cash rate to 3.1 per cent. On the back of those figures, the Reserve Bank now expects headline inflation to reach around 8 per cent by the end of this year, before gradually falling back to a little above 3 per cent in 2024. "The size and timing of future interest rate increases will continue to be determined by the incoming data and the board's assessment of the outlook for inflation and the labour market. The latest move takes the RBA's cash rate target to 2.85 per cent, up from a record low of 0.1 per cent at the start of May this year, and the highest it has been since May 2013. The Reserve Bank has raised its cash rate target by 0.25 of a percentage point, opting against a return to steeper interest rate hikes.

The Reserve Bank of Australia has pulled the trigger on another 25 basis point rate rise and upgraded its peak inflation forecasts off the back of ...

The central bank has also revised its growth forecast down a little, and now expects growth of around three per cent this year and 1.5 per cent in 2023 and 2024. The central bank expects inflation to simmer down to 4.75 per cent next year and a touch over three per cent in 2024. Help keep independent and fair Sunshine Coast news coming by subscribing to our free daily news feed. All it requires is your name and email. The central bank has also added around 0.25 percentage points to its peak inflation forecast, and now expects it to reach eight per cent before the end of the year. “The board recognises that monetary policy operates with a lag and that the full effect of the increase in interest rates is yet to be felt in mortgage payments,” Dr Lowe said in a statement.

ICYMI: The RBA has given mortgage holders breathing space with a 25 basis-point increase as it waits on data to see if seven consecutive monthly increases ...

Its data showed a small uptick in the proportion of loans with a fixed component during October. “As such, a significant amount of tightening lays ahead irrespective of how much higher the RBA takes the cash rate. Borrowers are understandably seeking certainty in their home loan repayments,” Mr Waldron said. “The rise in demand for fixed rate loan products is unsurprising in an environment where rates look set to rise for some time yet. “A central bank which has a 2 to 3 per cent inflation target and accepts that 4.75 per cent inflation in the following policy year runs the risk of embedding an inflationary psychology for both businesses and employees, making it more difficult to avoid an even more extended period of high inflation,” he said. or even higher?](https://thewest.com.au/business/economy/rba-interest-rates-more-mortgage-pain-to-come-but-a-cup-day-punt-on-a-supersized-hike-could-be-a-fools-bet--c-8710698#3903) This in turns reduces the need to continue to take the policy rate higher and deeper into restrictive territory in 2023.” “It now seems that the board is prepared to await the impact of the series of hikes at that risk of embedding an inflation psychology in the system which would eventually require a much more damaging policy response,” Mr Evans said. “Australians have been told their power bills are going up by more than 50 per cent, their mortgage payments will continue to rise, the cost of groceries will remain high, inflation will continue to surge and yet the Government still has no plan to tackle this cost of living crisis,” Opposition treasurer Angus Taylor said. He added that though the RBA statement suggested the size of future rate hikes would be determined by the data, that condition appeared to be “very high” for anything more than 25bp. [Today’s 25bp move risky: Westpac](https://thewest.com.au/business/economy/rba-interest-rates-more-mortgage-pain-to-come-but-a-cup-day-punt-on-a-supersized-hike-could-be-a-fools-bet--c-8710698#3997) [And the first mover on rates is ...](https://thewest.com.au/business/economy/rba-interest-rates-more-mortgage-pain-to-come-but-a-cup-day-punt-on-a-supersized-hike-could-be-a-fools-bet--c-8710698#3990) [Rate hikes will take time to have an impact: CBA](https://thewest.com.au/business/economy/rba-interest-rates-more-mortgage-pain-to-come-but-a-cup-day-punt-on-a-supersized-hike-could-be-a-fools-bet--c-8710698#3986) [Turn the tables on the banks](https://thewest.com.au/business/economy/rba-interest-rates-more-mortgage-pain-to-come-but-a-cup-day-punt-on-a-supersized-hike-could-be-a-fools-bet--c-8710698#3978) [Rate pain ‘felt around the kitchen table’](https://thewest.com.au/business/economy/rba-interest-rates-more-mortgage-pain-to-come-but-a-cup-day-punt-on-a-supersized-hike-could-be-a-fools-bet--c-8710698#3970) [Rates hit nine-year high](https://thewest.com.au/business/economy/rba-interest-rates-more-mortgage-pain-to-come-but-a-cup-day-punt-on-a-supersized-hike-could-be-a-fools-bet--c-8710698#3963) [One thing is for certain ...](https://thewest.com.au/business/economy/rba-interest-rates-more-mortgage-pain-to-come-but-a-cup-day-punt-on-a-supersized-hike-could-be-a-fools-bet--c-8710698#3961) [Brace yourself for an end to the fixed rate holiday](https://thewest.com.au/business/economy/rba-interest-rates-more-mortgage-pain-to-come-but-a-cup-day-punt-on-a-supersized-hike-could-be-a-fools-bet--c-8710698#3931) [The grim ‘fully absorbed’ warning for household budgets](https://thewest.com.au/business/economy/rba-interest-rates-more-mortgage-pain-to-come-but-a-cup-day-punt-on-a-supersized-hike-could-be-a-fools-bet--c-8710698#3927) [PSA: Before you place that bet](https://thewest.com.au/business/economy/rba-interest-rates-more-mortgage-pain-to-come-but-a-cup-day-punt-on-a-supersized-hike-could-be-a-fools-bet--c-8710698#3924) [What are the odds of a supersized 50bp hike ... Forget the glitz, glamour and big hats of the Melbourne Cup and all that “it’s the race that stops a nation” waffle.

Reserve Bank governor Philip Lowe says half percentage point increases to cash rate possible if economic conditions do not improve.

[the economic measure considered the “real” inflation figure](https://www.rba.gov.au/education/resources/explainers/inflation-and-its-measurement.html) as it excludes items with the largest price increases and falls, to between 2% and 3%. “It hurts us all by impairing the functioning of our economy. “Similarly, if the situation requires us to hold steady for a while, we will do that. “We will do what is necessary to achieve that. “We are not on a pre-set path, though. If we need to step up to larger increases again to secure the return of inflation to target, we will do that.

Though better news for mortgage-holders than some expected, there is still likely more pain on the horizon with another rate rise looming in December.

Estimates are based on a 30-year principal and interest loan. “If you start trimming around the edges, it’ll make you readier for more rate rises ahead,” she said. “It’ll be hard for December and I think the RBA will be watching consumers’ reaction carefully. “The RBA communication over the last year or so hasn’t been clear at times and there’s obviously a lot going on,” said Plank. “But the real pain is unemployment.” Price rises have been fuelled, according to the Australian Bureau of Statistics (ABS), by higher prices for food, new dwelling construction and petrol. 5.75% variable rate 5.5% variable rate 5.25% variable rate 5% variable rate 4.75% variable rate “They just can’t allow inflation to get embedded, as we all know the long-term costs of that can be very significant.

Philip Lowe has hinted at worsening interest rates while issuing a grim warning about inflation, with even more dire predictions for 2023.

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The Reserve Bank lifted the cash rate for the seventh time this year, but disappointed traders who had wagered on a more aggressive statement.

It tightened by 0.75 percentage points in the previous policy meeting. They imply a peak rate of 4.96 per cent next year, 1 percentage point above the RBA’s expected terminal rate. Last month, they expected that the RBA would need to go as far as 4.4 per cent. [Some economists had called for a bigger increase of 0.5 percentage points](https://www.afr.com/policy/economy/westpac-tips-supersized-melbourne-cup-rate-hike-3-85pc-peak-20221027-p5btdu) after annual inflation rose to 7.3 per cent in the September quarter, exceeding forecasts for a 7 per cent increase. Ivan Colhoun, chief economist at NAB’s institutional banking unit, forecasts a policy pause arriving in the first half of next year after the cash rate reaches an assumed peak of 3.6 per cent. It lifted its cash rate by 0.25 percentage points, following four consecutive outsized moves of 0.5 percentage points. The RBA will publish more details in its Statement on Monetary Policy on Friday. Email Cecile at [[email protected]](mailto:[email protected]) Last week, the Bank of Canada raised its policy rate by a smaller-than-expected increase of half a percentage point to 3.75 per cent and warned the economy would soon stall. US bond futures are fully priced for a 0.75 percentage point increase to the Fed’s funds rate at the end of its two-day meeting on November 2 to a new range of 3.75 per cent to 4 per cent. Australian interbank futures are nearly fully priced for another 0.25 percentage point lift to the cash rate in December, with the cash rate peaking at 3.9 per cent mid-next year. Australian government bond yields eased with the three-year rate down six basis points to 3.29 per cent and the 10-year rate retreating three basis points to 3.76 per cent.

The Reserve Bank of Australia won't hesitate to push through even bigger interest rate hikes if they're needed to to fight the "scourge of inflation", ...

"This would increase the risk of a severe recession and a sharp rise in unemployment. The information provided on this website is general in nature only and does not constitute personal financial advice. The information has been prepared without taking into account your personal objectives, financial situation or needs. If we need to step up to larger increases again to secure the return of inflation to target, we will do that. "If this were to happen, the evil of inflation would be with us for longer and the eventual increase in interest rates needed to bring it down would be greater. Similarly, if the situation requires us to hold steady for a while, we will do that."