RBA set to extend rate pause as housing crisis props up prices

RBA set to extend rate pause as housing crisis props up prices

Australia’s record household debt was a key factor in the Reserve Bank’s cautious approach to tightening, and now housing is an important consideration in the RBA becoming an outlier in the easing cycle and keeping interest rates on hold this week.

Housing costs, including rents, constitute roughly a fifth of Australia’s consumer basket and are the biggest driver of inflation after services. That helps explain governor Michele Bullock’s hawkish rhetoric and why economists see the RBA holding the cash rate at a 12-year high of 4.35 per cent on Tuesday — and keeping it there until at least February.

Source link

#RBA #set #extend #rate #pause #housing #crisis #props #prices