Hunter residents are expected to once again feel the pinch after the RBA announced it will raise interest rates to 3.6%.

This is the tenth consecutive hike in 11 months.

Australians have faced regular increases since May 2022, with the exception of January 2023.

RBA Governor Philip Lowe made the announcement following a closed-door meeting with the board.

“At its meeting today (Tuesday 7 March), the board decided to increase the cash rate target by 25 basis points to 3.6%,” he said.

“It also increased the interest rate on Exchange Settlement balances by 25 basis points to 3.5%.”

Mr Lowe painted a grim picture.

“Global inflation remains very high,” he said.

“In headline terms it is moderating, although services price inflation remains elevated in many economies.

“It will be some time before inflation is back to target rates.

“The outlook for the global economy remains subdued, with below average growth expected this year and next.”

Tenants are expected to also feel the pinch.

“Rents are increasing at the fastest rate in some years, with vacancy rates low in many parts of the country,” Mr Lowe said.

“The central forecast is for inflation to decline this year and next, to be around 3% in mid-2025.

“The board recognises that monetary policy operates with a lag and that the full effect of the cumulative increase in interest rates is yet to be felt in mortgage payments.

“There is uncertainty around the timing and extent of the slowdown in household spending.

“Some households have substantial savings buffers, but others are experiencing a painful squeeze on their budgets due to higher interest rates and the increase in the cost of living.

“Household balance sheets are also being affected by the decline in housing prices.

“Another source of uncertainty is how the global economy responds to the large and rapid increase in interest rates around the world. These uncertainties mean that there are a range of potential scenarios for the Australian economy.

“The board remains resolute in its determination to return inflation to target and will do what is necessary to achieve that.”

For more stories like this:

• Nov 2021: Morrison issues warnings on interest rates
• Dec 2022: Soaring interest rates stunt business growth
• May 2022: RBA warns of more cash rate rises
• May 2022: Cooling house prices, rising interest rates, an election and a buffer
• March 2022: COVID, War and interest rates

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