Reserve Bank rate rise expected, relief unlikely until 2027

Summarised from 2 outlets · Updated 2 Nov, 17:08 · Archive

The Reserve Bank is expected to raise the cash rate to an 18-year high on Tuesday, with bond markets pricing the increase at greater than 80 per cent. The rise follows hot inflation in the September quarter and hawkish comments from central bank officials. This will mean interest rates hit their highest level since 2008.

Mortgage holders face a lengthy wait for relief. Commonwealth Bank economists expect this to be the RBA's last rate rise this cycle, slashing their forecasts for economic growth to one per cent by mid-2027 and raising their unemployment projection to 5.1 per cent. They anticipate the RBA could start cutting rates in the second half of 2027, though they note high uncertainty over the timing.

One Adelaide account manager who entered the market in 2021 at a record low cash rate of 0.1 per cent said his family had not yet made significant changes to their budget but acknowledged that selling possessions could become a possibility.

How it is being reported

• Long wait for mortgage relief after odds-on rate riseThe Reserve Bank is tipped to lift the cash rate to an 18-year high and if some economists are to be believed, mortgage-holders face a lengthy wait for relief.Perth Now · 2 Nov, 16:36
• Long wait for mortgage relief after odds-on rate riseThe Reserve Bank is tipped to lift the cash rate to an 18-year high and if some economists are to be believed, mortgage-holders face a lengthy wait for relief.The West Australian · 2 Nov, 16:35

In this story: Reserve Bank of Australia · Commonwealth Bank · Adelaide · Melbourne

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