Macquarie interest rate strategist Rory Robertson is predicting the Reserve Bank may raise interest rates as early as November and then again in December.
Commenting on Reserve Bank governor Glenn Stevens’ warning yesterday that the official cash rate would have to rise soon from its historic low of three percent, Robertson said Australians should brace themselves for back-to-back 25-basis-point hikes in November and December.
“We’ve known for a while now that the RBA is keen to start removing its three percent ‘emergency policy setting’ at the earliest available opportunity, and November is looking increasingly firm,” Roberston said.
“Nothing is guaranteed, but the scenario of back-to-back 25bp hikes in November and December should be taken seriously.”
A 25 basis point increase to the cash rate would add $40 to the average monthly payment on a $300,000 25-year home loan, while a 50 basis points increase, adds $80 to the same sized loan.
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