The Reserve Bank has made history, weighing into the politically-charged federal election campaign by raising interest rates to their highest in a decade. In a widely anticipated move, the bank lifted the official cash rate by 0.25 percentage points to 6.75 per cent this morning – the first time it has moved rates during an election campaign.
Lenders are expected to respond quickly, lifting the standard variable mortgage rate above 8.5 per cent. The increase will add $67 a month to repayments on a $400,000 loan, bringing to $395 the cumulative impact of six interest rate rises since the last election, when the Coalition campaigned on a promise to keep rates low. More….
The Coalition is expected to respond today by emphasising risks in the economy and the need to continue with an experienced pair of hands managing the economy.