A Shocking Rally Against Inflation: RBA Raises Interest Rates Again

The Reserve Bank of Australia (RBA) has raised interest rates again in its latest effort to bring down stubbornly high inflation. This recent hike brings the official cash rate target up by 25 basis points, from 3.6% to 3.85%, making it the 11th hike since April 2022. 

The nation’s cash rate is now at its highest since April 2012. RBA Governor Philip Lowe stated that inflation in Australia has passed its peak but remains too high at 7%. He believes it will take a couple of years to bring inflation back to the target range of 2-3%. 

Treasurer Jim Chalmers called the decision a “cruel blow” to Australian households, and experts predict that the economy will slow substantially. The RBA’s decision to raise the cash rate for the 11th time in 12 months is seen as a necessary evil to bring inflation under control. However, homeowners will face even higher costs as the cost of groceries, fuel, and energy also rises. 

Experts suggest homeowners look for the most competitive rate available and plan to make the switch or negotiate a lower rate with their current lender at least a month before their fixed rate expires.