ustralia’s central bank has just delivered another blow to borrowers across the country as it hiked interest rates yet again. On Tuesday afternoon, the Reserve Bank of Australia (RBA) increased the cash rate by 25 basis points, bringing it to 4.10 per cent.That’s a significant jump from the historic pandemic low of 0.1 per cent that Australians enjoyed for more than two years.
This marks the 12th time the bank has hiked rates since May last year and is the highest the cash rate has been for the past 11 years. Mortgage owners have been hit with a 400 basis point hike in the space of a year in what has been hailed as the fastest tightening cycle on record, as inflation stays stubbornly high.
April 2023 has been the only exception, when the RBA briefly paused rates, giving mortgage holders a much-needed reprieve. However, new data from the Bureau of Statistics found Australia’s inflation is still stubbornly high, sitting 6.8 per cent in the past 12 months ending April.
In a worrying trend, the RBA’s inflation target is to keep consumer price inflation between two to three per cent, which is clearly nowhere near current levels.
Source REA news: