Why property and stock markets are thumbing their noses at rate hikes
6 months, 1 week ago

Why property and stock markets are thumbing their noses at rate hikes

ABC  

This time it's different. Photo shows RBA governor Michele Bullock at press conference Rate rise after rate rise should have sent the economy into a tailspin, but the RBA isn't fighting a textbook case of inflation. And it's seen central bankers scrambling to try to nut out just why developed economies aren't reacting to interest rate hikes the way they once did. For more than 20 years, every time there's been a hiccup in the global economy, central banks have sprayed vast amounts of cash around in a bid to save us from ourselves. The Reserve Bank's new deputy governor plays down this week's inflation surprise, saying there is plenty of economic data between now and the bank's next interest rate meeting in August.

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History of this topic

The RBA is preparing for all economic scenarios, including an interest rate hike
4 weeks, 1 day ago

The RBA is preparing for all economic scenarios, including an interest rate hike

ABC  

The Reserve Bank may have dropped the phrase "not ruling anything in or out" in its interest rates commentary, but that does not mean an interest rate hike is completely out of the question. That is because, as Dr Hunter explained, it would mean the RBA's key policy goal of achieving its mid-point annual inflation target of 2.5 per cent …

Sharply rising bond rates could stem Wall Street's 'relief rally' and push interest rate cuts further into the future
2 months ago

Sharply rising bond rates could stem Wall Street's 'relief rally' and push interest rate cuts further into the future

ABC  

The apparent roar of approval was almost deafening. It's a world that, down the track, promises a return of inflation and permanently higher interest rates as America shifts to a more protectionist global stance that punishes China and, by extension, hurts Australia. Since mid-September, US money markets almost inexplicably have begun forecasting a rise in interest rates. The bond is …

Why the Reserve Bank will be forced to cut rates before year's end
4 months ago

Why the Reserve Bank will be forced to cut rates before year's end

ABC  

Until just a few weeks ago, it seemed as though the developed world had pulled off what once was thought to be the impossible. And yet, despite this mounting evidence of a critical economic slump, there remains a rump of high-profile economists openly criticising the Reserve Bank of Australia's reluctance to push interest rates above 5 per cent. Parliament House …

The US is about to start cutting interest rates, so expect Australia to follow
4 months, 2 weeks ago

The US is about to start cutting interest rates, so expect Australia to follow

ABC  

Just three weeks ago, Reserve Bank Governor Michele Bullock declared interest rate cuts unlikely in the next six months. But if there was any doubt about what's going to happen to global interest rates, the US Federal Reserve chair Jerome Powell removed it on Saturday. Rate cuts by the US Fed and other central banks will create a near-irresistible pressure …

Why Reserve Bank of Australia boss Michele Bullock is refusing to consider cutting rates soon - even though mortgage holders in New Zealand, Canada, UK and EU have already had some relief
4 months, 3 weeks ago

Why Reserve Bank of Australia boss Michele Bullock is refusing to consider cutting rates soon - even though mortgage holders in New Zealand, Canada, UK and EU have already had some relief

Daily Mail  

The woman who decides the fate of millions of mortgage holders has declared a rate cut won't be happening anytime soon - despite what other countries have done this year. Reserve Bank Governor Michele Bullock told a parliamentary hearing on Friday that Australia would not be copying the approach of other central banks that have cut rates this year, with …

The RBA says don't expect interest rate cuts for six months. Here's why it could be sooner
5 months ago

The RBA says don't expect interest rate cuts for six months. Here's why it could be sooner

ABC  

Days ago, at the start of last week, there was talk of a Reserve Bank rate hike. So despite what the Reserve Bank governor said on Tuesday, here's why so many people expect interest rates will have to come down — possibly sooner than predicted. It was 3.6 per cent by March, then 3.8 per cent in June, and will …

With rates on hold again, the government and the public hold their breath. What comes next?
5 months ago

With rates on hold again, the government and the public hold their breath. What comes next?

ABC  

The Reserve Bank's decision to leave interest rates unchanged is the latest in a series of fizzers. RBA governor Michele Bullock did take the unusual step of telling us we should not expect a rate cut in the next six months, taking us out to at least February next year. RBA Board keeps interest rates at 4.35 per cent Photo …

Why the Reserve Bank of Australia should hold off on interest rate hikes in August
5 months, 1 week ago

Why the Reserve Bank of Australia should hold off on interest rate hikes in August

ABC  

There's a curious thing about openness, communication and transparency. Because, despite recently showing a real reluctance to want to push interest rates even higher, she and her Reserve Bank of Australia colleagues have for the past two years made it abundantly clear that they were committed to hammering inflation into submission. Money markets right now have just a one-in-five chance …

'RBA to hike in August', says investment bank as property market pushes on up
6 months, 2 weeks ago

'RBA to hike in August', says investment bank as property market pushes on up

ABC  

In short: The Australian property market will remain robust this year and next, according to several analysts. Australian property prices are expected to increase by as much as 5 per cent in calendar year 2024, according to the June PropTrack Property Market Outlook Report. "We got capital cities a little stronger at 6 to 7 per cent for the 2024 …

RBA's 'narrow path' gets narrower with an interest rate rise more likely than a cut
6 months, 3 weeks ago

RBA's 'narrow path' gets narrower with an interest rate rise more likely than a cut

ABC  

You could see, hear and feel the pressure on Reserve Bank boss Michele Bullock at yesterday's press conference, held after an angst-filled decision to do nothing. Before being peppered with questions, the RBA governor prefaced the discussion by outlining the "complex" economic dilemma the bank's board confronts. "I think the RBA probably should have increased rates a little bit further, …

RBA should now 'in theory' hike interest rates in June, but will it?
7 months, 1 week ago

RBA should now 'in theory' hike interest rates in June, but will it?

ABC  

Inflation is rising again, and that's a problem for both the government and the Reserve Bank. The annual rate of inflation has ticked up slightly in April to 3.6 per cent, from 3.5 per cent in March, but economists say it's enough to put even more pressure on the Reserve Bank. "At the moment consumers are the ones copping all …

The Reserve Bank's interest rate dilemma: Households are hurting but inflation remains stubbornly high
8 months ago

The Reserve Bank's interest rate dilemma: Households are hurting but inflation remains stubbornly high

ABC  

Please make it stop. That's what Michele Bullock must say to herself after RBA board meeting days, when journalists conjure a dozen different ways to ask the same question — what's going to happen with interest rates? Over the past year, the inflation rate for discretionary goods and services has been within the RBA's 2-3 per cent target band, at …

'Too soon to declare victory' as RBA governor Bullock says she can't rule out another rate rise
8 months ago

'Too soon to declare victory' as RBA governor Bullock says she can't rule out another rate rise

ABC  

In short : Interest rates have been kept steady, at 4.35 per cent. RBA does not want to tip economy into recession, Bullock says On Tuesday, Governor Bullock said when the RBA lifted rates in November, from 4.1 to 4.35 per cent, it was "taking out a little insurance." The RBA's preferred "core" measures of inflation, such as the trimmed …

Why the RBA may be forced to cut interest rates before the Fed
10 months, 3 weeks ago

Why the RBA may be forced to cut interest rates before the Fed

ABC  

There's been a nearly universal assumption by both analysts and traders that the US Federal Reserve will effectively kick off the global rate-cutting cycle for developed economy central banks. While the average mortgage rate in Australia has risen by 3.2 percentage points since the RBA started hiking, US home borrowers, on average, have seen their interest rates rise 0.5 of …

Financial markets are jonesing for interest rate cuts. Not so fast, says the European Central Bank
11 months, 2 weeks ago

Financial markets are jonesing for interest rate cuts. Not so fast, says the European Central Bank

Associated Press  

FRANKFURT, Germany — European Central Bank President Christine Lagarde pushed back Thursday against market expectations for quick interest rate cuts even as Europe’s economy sputters and financial markets froth in hopes of cheaper credit that would boost business activity and stock prices. was that it was premature to discuss rate cuts.” Financial markets have been expecting a cut as early …

Reserve Bank raises interest rates, repayments now up more than 50pc since hikes began
1 year, 2 months ago

Reserve Bank raises interest rates, repayments now up more than 50pc since hikes began

ABC  

After keeping rates on hold for the past four meetings, the Reserve Bank has resumed hiking its cash rate target, with a quarter of a percentage point increase taking the benchmark interest rate to 4.35 per cent. Key points: At 4.35 per cent, the cash rate is at its highest level in 12 years The rate rise will add around …

High interest rates is hurting one more industry: Mortgage lenders
1 year, 2 months ago

High interest rates is hurting one more industry: Mortgage lenders

Al Jazeera  

Mortgage brokers, who rely on commissions, are struggling as their income has dipped as home buyers move to cash. That’s because potential homebuyers are waiting for interest rates to start coming down – meaning prospective clients for mortgage lenders like Clark are in holding patterns of sorts. That’s seven percent higher than this time last year “One way to avoid …

Why global financial markets are walking a tightrope
1 year, 2 months ago

Why global financial markets are walking a tightrope

ABC  

If the past few months are anything to go by, the era of dependable double digit super returns may be drawing to a close. Longer term, they have upended trading patterns and drawn the curtain on almost three decades of global trade liberalisation, ushering in a new Cold War that's threatening to turn hot. That's left money managers dazed and …

Rising long-term interest rates are posing the latest threat to a US economic ‘soft landing’
1 year, 3 months ago

Rising long-term interest rates are posing the latest threat to a US economic ‘soft landing’

Associated Press  

WASHINGTON — Surging interest rates are intensifying the challenges for the U.S. economy and threatening to derail the Federal Reserve’s drive to tame inflation without causing a deep recession. The jump in longer-term rates coincides with other threats, from higher gas prices and this week’s resumption of student loan payments to autoworkers’ ongoing strike and the risk of a government …

RBA holds interest rates steady, and homeowners breathe a sigh of relief — but for how long?
1 year, 6 months ago

RBA holds interest rates steady, and homeowners breathe a sigh of relief — but for how long?

ABC  

The RBA has left its cash rate target unchanged at 4.1 per cent — and home owners aren't the only ones breathing a sigh of relief. In the final paragraph of the Reserve Bank governor Philip Lowe's statement on Tuesday he said: "Some further tightening of monetary policy may be required to ensure that inflation returns to target in a …

World banks are lifting rates higher and markets aren’t yet sure what to make of it
1 year, 6 months ago

World banks are lifting rates higher and markets aren’t yet sure what to make of it

LA Times  

Stocks drifted to a mixed finish on Wall Street on Thursday as central banks around the world keep cranking interest rates higher in their fight against inflation. The Fed held interest rates steady at its last meeting after raising rates aggressively throughout 2022 and into 2023 to tame painfully high inflation. Central banks worldwide have been raising interest rates to …

Mint Explainer: Why the US Federal Reserve didn’t raise rates
1 year, 6 months ago

Mint Explainer: Why the US Federal Reserve didn’t raise rates

Live Mint  

After 10 consecutive increases, the US Federal Reserve has decided to pause the federal funds rate, which is currently in the range of 5% to 5.25%. The federal funds rate is the rate at which commercial banks in the US lend money held in the Federal Reserve system to each other on an overnight basis. So, inflation has been coming …

RBA's rate hikes creating inflation, Ross Garnaut says, calling for radical overhaul of economic policy
1 year, 8 months ago

RBA's rate hikes creating inflation, Ross Garnaut says, calling for radical overhaul of economic policy

ABC  

Australia's economy has become increasingly dominated by powerful firms that are extracting "economic rents" from the system, economist Ross Garnaut is warning. "There have been big changes over the 21st century that greatly affect Australia's capacity to deliver rising standards of living to most people in a growing population," Professor Garnaut said. Professor Garnaut said "economic rent" referred to income …

Reserve Bank hikes cash rate to 3.85 per cent, ASX hits three-week low, Qantas appoints new CEO to replace Alan Joyce
1 year, 8 months ago

Reserve Bank hikes cash rate to 3.85 per cent, ASX hits three-week low, Qantas appoints new CEO to replace Alan Joyce

ABC  

Here are some comments from Callam Pickering, an economist at global job site Indeed. He's just put out this note on the rate decision, which I think is worth quoting in full: "The flow of recent economic data provides a compelling case for further rate hikes,” he said. "The RBA anticipates that further rate hikes may well be needed to …

The RBA's interest rate pause was a close call that could change as early as next month
1 year, 8 months ago

The RBA's interest rate pause was a close call that could change as early as next month

ABC  

The Reserve Bank has revealed its decision to pause its aggressive interest-rate-hiking strategy was a close call, while warning that more hikes may be needed to tame inflation. Key points: The RBA kept interest rates on hold this month for the first time in a year Minutes from the meeting show board members want time to see the lagged impact …

Rising interest rates have put some borrowers in trouble, but the RBA says the banks will be fine
1 year, 9 months ago

Rising interest rates have put some borrowers in trouble, but the RBA says the banks will be fine

ABC  

A significant group of borrowers are at serious risk of default, but Australian banks will be able to comfortably survive any losses, argues the Reserve Bank. Key points: Around 15 per cent of borrowers are forecast to have "negative spare cash flow" About 9 per cent of borrowers are expected to run out of savings buffers by the middle of …

Lessons from the US bank crisis
1 year, 9 months ago

Lessons from the US bank crisis

Hindustan Times  

Last week ended with the United States Federal Reserve raising interest rates by 25 basis points once again, taking the cumulative rate increase to 4.75 percentage points in the current cycle. Had the latest federal open market committee meeting not been preceded by two bank failures and the possibility of a crisis in many others, the rate hike would have …

Federal Reserve hikes interest rates but gives RBA room to pause
1 year, 9 months ago

Federal Reserve hikes interest rates but gives RBA room to pause

ABC  

Never waste a crisis. "We did consider that in the days running up to the meeting," Powell told reporters in a press conference after today's rate rise decision, referring to a period where the banking crisis threatened to spiral out of control. But Powell was keen to maintain a link between the US banking crisis and inflation when explaining why …

"Even more financial chaos": Latest hike by Fed "risks throwing millions of Americans out of work"
1 year, 9 months ago

"Even more financial chaos": Latest hike by Fed "risks throwing millions of Americans out of work"

Salon  

This article originally appeared at Common Dreams. Fed Chair Jerome Powell told reporters Wednesday that although the Federal Open Market Committee "did consider" a pause on rate increases following the Silicon Valley Bank and Signature Bank failures, officials ultimately decided to raise the federal funds rate to a range of 4.75-5%, the highest level since 2007. "The Fed under Chair …

Why RBA interest rate hikes could end by September – but brace for at least one more
1 year, 10 months ago

Why RBA interest rate hikes could end by September – but brace for at least one more

ABC  

Tuesday's 10th successive Reserve Bank interest rate hike is the culmination of a process that has added $1,080 to the monthly cost of payments on a $600,000 variable mortgage. I've calculated this increase in payments — which amounts to $12,960 per year — by comparing payments on the National Australia Bank's base variable mortgage rate before the Reserve Bank started …

RBA boss Philip Lowe defends record bank profits as he flags further rate hikes
1 year, 10 months ago

RBA boss Philip Lowe defends record bank profits as he flags further rate hikes

ABC  

Reserve Bank governor Philip Lowe says it is important in the long term to have "strong" banks that are turning a profit, even though it may be hard to hear for people in the grips of skyrocketing mortgage repayments. Key points: Mr Lowe said the RBA was not sure when it would stop raising rates The cash rate is currently …

Reserve Bank warns of at least two more interest rate rises in coming months, as the economic outlook worsens
1 year, 11 months ago

Reserve Bank warns of at least two more interest rate rises in coming months, as the economic outlook worsens

ABC  

Australia's cash rate has hit 3.35 per cent, after the Reserve Bank raised interest rates for the ninth time in a row — and signalled more interest rate pain ahead. That was the view of traders in the money market, who had priced loans on the basis that the bank's cash rate would climb just 0.35 points further after being …

Interest rates are set to keep rising in 2023 but the RBA is playing with fire
1 year, 11 months ago

Interest rates are set to keep rising in 2023 but the RBA is playing with fire

ABC  

Late last November, Reserve Bank governor Philip Lowe was forced into a humiliating public apology. If the official rate hit 3.6 per cent, it found that just over half of all homeowners on variable mortgage rates would see a more than 20 per cent reduction in spare cash flow. That would be chaotic and you can bet your life the …

European Central Bank hikes rates, vows ‘we are not done’
1 year, 11 months ago

European Central Bank hikes rates, vows ‘we are not done’

Associated Press  

FRANKFURT, Germany — The European Central Bank chugged ahead with another outsized interest rate hike Thursday and vowed more will follow, underlining its drive to subdue inflation even as the economy slows and the U.S. Federal Reserve eases its pace of increases. The bank, which also hiked by a half-point in December, “will stay the course in raising interest rates …

European Central Bank expected to slow pace of rate hikes
2 years ago

European Central Bank expected to slow pace of rate hikes

The Independent  

For free real time breaking news alerts sent straight to your inbox sign up to our breaking news emails Sign up to our free breaking news emails Sign up to our free breaking news emails SIGN UP I would like to be emailed about offers, events and updates from The Independent. Read our privacy policy The European Central Bank is …

A fork in the road for mortgage borrowers: Spend cash buffers to meet higher repayments or cut back on spending?
2 years, 1 month ago

A fork in the road for mortgage borrowers: Spend cash buffers to meet higher repayments or cut back on spending?

ABC  

Money is being re-directed away from millions of Australians' bank accounts. It's that moment when you discover the majority of the Reserve Bank's interest rate increased have now been applied to your home loan and extracted from your bank account. According to RateCity, if you factor in the entire 2.75 per cent Reserve Bank rate increases, the total extra monthly …

Bank profits jump but rising interest rates are a double-edged sword
2 years, 1 month ago

Bank profits jump but rising interest rates are a double-edged sword

ABC  

Australia's big banks have raked in nearly $30 billion in 2022, but they are facing a tougher 2023, as some borrowers struggle with higher mortgage repayments as interest rates soar. Key points: Australia's big four banks made $28.5 billion in cash profits in 2022 Official rates have increased seven times since May to 2.85 per cent If unemployment rises, some …

After being forced to play catch-up in the 'war on inflation', Australia's banking masters have subtly switched course
2 years, 2 months ago

After being forced to play catch-up in the 'war on inflation', Australia's banking masters have subtly switched course

ABC  

For the past six months, it's been all action and precious little talk. A month back, Reserve Bank boss Phillip Lowe sparked a rally on global stock markets when he throttled back on the pace of interest rate rises from 0.5 percentage points back to 0.25, the first major central bank to do so. The inflation we nurtured A few …

Reserve Bank acknowledges its rapid rate hikes could force some people to sell their homes
2 years, 3 months ago

Reserve Bank acknowledges its rapid rate hikes could force some people to sell their homes

ABC  

The Reserve Bank of Australia has acknowledged that its rapid interest rate hikes could see some households with mortgages falling into arrears, forcing some to sell their homes or to enter foreclosure. Key points: The RBA says most households should be able to weather its interest rate hikes However, some households may be forced to sell their homes or enter …

As Reserve Bank lifts interest rates again, more households seek relief from Foodbank
2 years, 3 months ago

As Reserve Bank lifts interest rates again, more households seek relief from Foodbank

ABC  

Demand for food relief from Foodbank has increased by 15 per cent since the Reserve Bank of Australia started lifting interest rates in May. Key points: RBA's smaller-than-expected rate hike has surprised economists However, more rate rises are expected And more households are feeling severely financially strained from rising rates, rising inflation and falling real wages "Around half the people …

Here's what was happening in Australia the last time the cash rate rose this quickly
2 years, 3 months ago

Here's what was happening in Australia the last time the cash rate rose this quickly

ABC  

Interest rates have risen for five consecutive months, a period of increase that has felt very sudden for borrowers. The RBA hiked interest rates 0.75 percentage points to 5.5 per cent in an effort to keep that inflation figure low and steady. It was the first rate rise in five years, and RBA governor Bernie Fraser said it was "necessary …

More interest rate rises ahead but pace of increase set to slow, RBA governor says
2 years, 3 months ago

More interest rate rises ahead but pace of increase set to slow, RBA governor says

ABC  

Reserve Bank governor Philip Lowe says he will keep lifting interest rates but the pace will soon slow down and he is confident the economy can absorb the rises. Key points: RBA governor Philip Lowe warns of more rate rises ahead, but they may be smaller increases Mr Lowe said it would not surprise him if property prices fell 10 …

Reserve Bank raises interest rates again in most aggressive increases since 1994
2 years, 4 months ago

Reserve Bank raises interest rates again in most aggressive increases since 1994

ABC  

The Reserve Bank has raised interest rates by 0.5 of a percentage point, taking its cash rate target to 2.35 per cent. Key points: The RBA has raised the cash rate by 0.5 of a percentage point for the fourth straight month The cash rate target of 2.35 per cent is the highest since the beginning of 2015 RBA governor …

RBA's clue that interest rates will keep rising as property prices suffer steepest drop since 1983
2 years, 4 months ago

RBA's clue that interest rates will keep rising as property prices suffer steepest drop since 1983

Daily Mail  

The Reserve Bank of Australia has given some chilling clues it will keep raising interest rates even after Tuesday's forecast rate rise, as property prices fall at the fastest pace in almost 40 years. House prices drop in almost EVERY capital city market in August SYDNEY: Down 2.6 per cent to $1,302,635 MELBOURNE: Down 1.5 per cent to $948,879 BRISBANE: …

Why Australian banks are slashing fixed-rate home loans despite successive interest rate rises
2 years, 5 months ago

Why Australian banks are slashing fixed-rate home loans despite successive interest rate rises

ABC  

It may have gone largely unnoticed among the screeching sirens and the roar of emergency vehicles — but interest rates actually fell last week. In the rush to deliver the bad news on a hugely telegraphed double hike in the official cash rate — which the big four banks passed on in full on their variable rates — most news …

RBA increases to interest rates mean home buyers who bought at the peak are facing rapidly rising mortgage repayments
2 years, 5 months ago

RBA increases to interest rates mean home buyers who bought at the peak are facing rapidly rising mortgage repayments

ABC  

While some Australians may rejoice at the idea of a drop in house prices, interest rate rises mean home owners face the prospect of their asset dropping in value at the same time their mortgage repayments steadily increase. Key points: House prices in Australia are dropping at their fastest pace since the global financial crisis Those who bought houses at …

Interest rates for savings accounts are rising after rate hike, but are they quick enough and by how much?
2 years, 6 months ago

Interest rates for savings accounts are rising after rate hike, but are they quick enough and by how much?

ABC  

The Reserve Bank's cash rate hike may be doom and gloom for mortgage borrowers, but Inge Meldgaard is hopeful that higher rates will boost earnings from her savings. Reserve Bank lifts interest rates by 50 basis points Photo shows Sarah Treloar The Reserve Bank increases interest rates by 50 basis points, taking the cash rate target to 0.85 per cent …

Reserve Bank 0.5 percent interest rate hike the first of many realestate expert Lloyd Edge claims
2 years, 7 months ago

Reserve Bank 0.5 percent interest rate hike the first of many realestate expert Lloyd Edge claims

Daily Mail  

A real estate expert who predicted the Reserve Bank's landmark 0.5 per cent increase in the official cash rate this week has encouraged Australians to put aside $350 extra a month to help see them through further hikes. 1 - Speak to a financial advisor and/or mortgage broker 2 - Ask your bank for a reduced interest rate 3 - …

Reserve Bank lifts interest rates by higher-than-expected half a percentage point, causing more pain for borrowers
2 years, 7 months ago

Reserve Bank lifts interest rates by higher-than-expected half a percentage point, causing more pain for borrowers

ABC  

When first home buyer Sarah Treloar took out a mortgage to buy an apartment in the western Sydney suburb of Homebush about a month ago, she was prepared for her interest rate to go up almost immediately. Key points: The Reserve Bank has moved well ahead of expectations, lifting the cash rate by half a percentage point to 0.85 per …

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