RBA July 2022 Cash Rate Decision
The RBA concluded their July meeting and have increased the central cash rate by 50 basis points to 1.35 per cent.
This is on the back of their June meeting of increasing by 50 basis points.
As always the key theme from the RBA is around inflation and employment.
The employment data is strong with a 3.9% unemployment rate for May and inflation is still trending above the 2-3% band and expected to peak later this year.
The challenge for the RBA is in relation to inflation, is this is at the core of spending (due to higher fuel and energy input costs), resulting from supply chain issues and the Ukraine War. Raising rates will do little to bring this number down.
With mortgage holders now paying between 3-4% on variable home loans, now it the time to review to ensure you are not paying too much.
RBA on the Australian Economy
Interesting the RBA feels that strong household consumption will continue this year and this will form a part of their monetary policy in the new year.
I believe the household consumption data will show a different picture early next year, with the RBA currently using May retail data to make this assessment.
My comment is the May retail data would largely exclude the impact of the May and June increase in interest rates on households.
If you would like to read more from the RBA decision, click here. To read about last month’s decision, click here.
Jeremy Harper is the director of hfinance. hfinance is a mortgage brokering business, to speak with a Sydney Mortgage Broker, Gold Coast Mortgage Broker or an Australian expat mortgage broker. Contact by calling us on 1300 928 227 or email info@hfinance.com.au. You can also book a meeting directly below.