The Reserve Bank of Australia has decided to increase the cash rate a further quarter of a percentage point, bringing it to 4.1 per cent - its highest level since April 2012. Read today’s official statement on the RBA’s website.

Today’s decision will cause further strain to borrowers struggling with cost of living pressures and rising interest rates.

But the move by the RBA shouldn’t come as a shock – there had been warnings that more hikes might be needed to bring inflation under control, after Australia’s headline inflation rate rose to 6.8 per cent for April 2023, up from 6.3 per cent the month prior.

Governor Lowe recently told federal MPs he had no tolerance for lingering high inflation and would do what needed to be done to bring it down.

Given today’s decision, lenders are likely to pass on the cash rate increase. If you’ve been with the same lender for some time or have been sitting back waiting to see where rates would go, now could be the time to review your mortgage.

To talk through your options, get in touch with Addisons today.

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