RBA increases cash rate to 3.35%

RBA increases cash rate to 3.35%

In line with market expectations, the Reserve Bank of Australia raised the official cash rate by 25 basis points to 3.35 per cent at its first monetary policy meeting of 2019.

Following the December quarter’s annual inflation rate reaching a 30-year high of 7.8%, the Reserve Bank of Australia raised interest rates for the ninth time in as many meetings.
The Reserve Bank of Australia (RBA) raised interest rates at its first meeting of 2019.

Notable Features • The target cash rate is presently at its highest level in a decade, at 3.35 per cent; • Inflation measured by the Consumer Price Index in 2022 was 7.8 per cent, the highest rate since 1990; •

Inflation needs to return to target; therefore, the Fed will likely raise interest rates again in the coming months.

According to Australia’s largest credit reporting agency, Equifax
The rising cost of living and the string of interest rate hikes have contributed to a continuing reduction in mortgage application volume, with Equifax data indicating a 16.1% drop in demand in the fourth quarter of 2022. The 2023 rate hike may be the tipping point that causes mortgage arrears to increase again.
Equifax reports that a new group of Australians are under financial stress; these people have overextended themselves due to a confluence of environmental variables like rising interest rates and a shift in the credit cycle.


It’s hardly surprising that people are resorting to credit to keep up with the rising cost of living, as December’s inflation rate of 7.8% was the highest since 1990. The holiday season’s shopping and travelling contributed to a 21% rise in credit card use in the fourth quarter of 2022, as reported by Equifax. Consumers may feel more financial strain due to this spending surge, which may affect interest rate decisions in the future.

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Plenty of borrowers, as reported by RateCity, a financial comparison website, would welcome the end of cash rate spikes. However, the RBA’s main priority is bringing inflation back under control in Australia.

tips-for-choosing-the right-real-estate-investment-course

The current rate of inflation of 7.8 per cent is very concerning. Raise the rate to convey that more effort is needed to bring this number down.

Each month you delay refinancing a loan of $500,000 might cost you up to $400. That’s the equivalent of dropping $10 a month on brand-new AirPods.

You need to do something at this minute. As real estate values fall, you may no longer qualify for the deepest price cuts. What’s worse is that you might discover you can’t refinance at all.


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