Interest Rate Blow for Aussie Mortgage Holders: Reserve Bank Delivers Fresh Cost of Living Hit Amid Soaring Inflation
- Reserve Bank keeps interest rates on hold at 3.6 per cent despite inflation rising to three per cent in August
- Australians with mortgages face another blow as borrowers must wait until at least November for potential relief
- Treasurer Jim Chalmers says the government has made progress on the economy, but acknowledges the challenges posed by global uncertainty
In a devastating blow to Aussie mortgage holders, the Reserve Bank has kept interest rates on hold at 3.6 per cent, despite inflation rising to a worrying three per cent in August. The move has dealt a fresh cost of living hit to households already struggling to make ends meet.
The Reserve Bank’s decision has sparked concerns that borrowers may have to wait until at least November for any potential relief, with stubbornly high inflation and a resilient labour market raising the possibility that the RBA has already delivered its last rate cut.
Treasurer Jim Chalmers acknowledged the challenges posed by global uncertainty, saying, “The volatility and uncertainty in the global economy does weigh heavily on our own domestic economy.” However, he also highlighted the government’s progress on the economy, saying, “We have been able to get inflation down while maintaining low unemployment. We have seen real wages and living standards grow in recent data.”
Chartered Accountants ANZ chief economist Richard Holden warned that the central bank was being cautious as it weighs opposing forces in the economy, including rising inflation, soft economic growth, and a robust labour market. “The RBA is trying to navigate a very difficult economic environment,” he said.
With interest rates on hold for now, experts are urging Aussies to shop around for better deals on their mortgages. Canstar.com.au data insights director Sally Tindall said, “Borrowers looking to turbo-charge their savings should consider switching to a lower rate mortgage. There are more than 30 lenders offering rates lower than the average owner-occupier rate of 5.53 per cent.”
The Reserve Bank’s decision has left many Aussie mortgage holders feeling anxious about their financial future. With interest rates on hold, it remains to be seen how households will cope with the rising cost of living.