Some borrowers at breaking point as RBA warns of possible rate hike | The Business | ABC NEWS

Some borrowers like Fiona Sweeting are under immense financial pain. She's relieved the RBA left interest rates on hold but says she's already had to cut back on everything to make her mortgage repayments and pay utility bills. The Reserve Bank governor warned more economic pain is ahead. Michele Bullock said interest rates will rise again if inflation does not come down. The RBA ended its run of consecutive rate hikes, leaving the cash rate steady at 4.35 per cent. Ms Bullock said "if inflation doesn't respond in the way we expect it to do, then we might have to do more." The inflation fight is being helped by the ceasefire deal between the US and Iran, but the central bank said it was early days and it had seen signs of higher oil prices flowing through to prices. The RBA now faces a balancing act between high inflation and a weakening jobs market. Michele Bullock said the RBA isn't forecasting the economy to shrink this quarter but does expect it to slow. She said that was necessary to get inflation down. Economists are split on what will happen next. Three of the big four banks, the Commonwealth Bank, ANZ and NAB expect no further rate hikes and are forecasting cuts next year, but AMP's deputy chief economist Diana Mousina thinks the central bank will raise again in August and potentially November. JP Morgan chief economist Ben Jarman says with inflation yet to peak, the RBA does not want people to assume the rate hiking cycle is finished.

For borrowers already under strain, comparison site Canstar says there are still competitive home loan deals in the market. Canstar estimates the average owner-occupier variable rate is now 6.26 per cent. But the lowest on its database is 5.69 per cent, meaning some borrowers may be paying more than they need to.
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Read more here: https://www.abc.net.au/news/2026-06-16/reserve-bank-keep-rates-on-hold-june-2026/106803692

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