The Reserve Bank of Australia (RBA) has lifted interest rates to an 11-year high of 3.6% in its effort to control inflation. This is the 10th consecutive meeting in which the cash rate has been increased by a quarter of a percentage point. On a $604,000 mortgage, today’s increase will add almost $100 to monthly repayments.
The RBA is in the midst of its most aggressive monetary policy tightening since the 1990s as it targets the inflation rate. As a result, the RBA is expecting economic growth to slow to 1.5% this year and the next, causing concerns about a potential recession over the next 24 months.
Following the rate hike, housing advocates have warned that it will cause financial pain to renters and punish people experiencing housing distress in New South Wales (NSW). Mark Degotardi, the chief executive of the Community Housing Industry Association NSW, says the rate rise will unleash enormous financial pain on households in NSW.
The Housing Industry Association (HIA) has also warned that the rate rise risks a slowdown in the building sector as it compounds the decline in building activity. On the other hand, Federal Treasurer Jim Chalmers has acknowledged that the RBA’s decision will make life harder for many Australians already under financial pressure.
In other news, a $105 million tax fraud scheme has resulted in three people, including the son of a former high-ranking Tax Office official, being found guilty of taking part.
Adam Michael Cranston, 36, Lauren Anne Cranston, 30, Dev Menon, 39, Jason Cornell Onley, 52, and Patrick Willmott, 36, faced trial in the NSW Supreme Court after pleading not guilty to conspiring to dishonestly cause a loss to the Commonwealth and conspiring to deal with more than $1 million believing it would be the proceeds of crime.
Meanwhile, iron ore billionaire Andrew Forrest has labelled the Sun Cable renewable energy project a dismal failure as it did not have a buyer to purchase the electricity.
The project, which involved selling green power to Singapore, had backing from Forrest and fellow billionaire Mike Cannon-Brookes, but the two billionaires could not agree on a path forward for the business.
The project’s offices were also spending too much on “palatial” offices, said Forrest.
Finally, Deputy Liberal leader Sussan Ley has dressed up as singer Tina Turner to raise money for cancer treatment. Labelling her alter ego “Ley-na Turner”, the former health minister wore a black dress and a wig in the style of the American artist’s wavy shag hairdo. The move was for a dare for a cancer support fundraiser held in Griffith.