The Reserve Bank of Australia have increased the cash rate for the 5th time in 5 months. The increase of 0.50% brings the new cash rate to 2.35%, the highest cash rate in 7 years. For those home owners currently on a variable home loan rate, you can expect the banks to follow with another interest rate increase in the coming weeks.

This latest rate rise will result in home owners with an average home loan of $500,000 needing to pay an extra $140 a month or $610 since the RBA first increased the cash rate in May 2022.

Inflation in Australia is the highest it has been since the early 1990s and is expected to peak later this year and then decline back towards the 2 – 3%.  The RBA says it will continue to do what’s necessary to tackle soaring inflation until it returns to the 2 – 3% range.

In today’s statement the RBA, Governor Philip Lowe said “The further increase in interest rates today will help bring inflation back to target and create a more sustainable balance of demand and supply in the Australian economy. Price stability is a prerequisite for a strong economy and a sustained period of full employment. The Board expects to increase interest rates further over the months ahead, but it is not on a pre-set path. The size and timing of future interest rate increases will be guided by the incoming data and the Board’s assessment of the outlook for inflation and the labour market.

If you are concerned about your home loan interest rates & repayments,  speak to a Mortgage Broker about your home loan options today.

This latest rate rise will result in home owners with an average home loan of $500,000 needing to pay an extra $140 a month or $470 since the RBA first increased the cash rate in May 2022.

The last time the RBA  lifted the rates over four consecutive months was in 1990. The announcement follows last week’s increase in annual inflation, which hit 6.1 per cent, the highest level in 21 years. The RBA says it will continue to do what’s necessary to tackle soaring inflation until it returns to the 2 – 3 per cent range.

With expectations that the cash rate will continue to increase over the coming months, now is the time to speak to a Mortgage Broker about your home loan options.

Click here to read the full RBA statement

Contact an Assured Lending Mortgage Broker for more information today

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RBA Increase Cash Rate