Interest Rate Cuts Could Be Delayed Until 2027 ?
- 2 hours ago
- 2 min read
Australian borrowers may have to wait until 2027 for interest rate relief, according to a new survey of leading economists.
The latest Australian Financial Review poll found that more than half of the 32 economists surveyed believe the Reserve Bank’s cash rate has already peaked at 4.35 per cent, making another rate rise less likely.
However, most economists do not expect rate cuts any time soon. Almost all respondents said the RBA is likely to keep rates on hold until at least 2027, with many predicting cuts will not begin until the second half of the year.
The Reserve Bank left interest rates unchanged at its June meeting, citing slower consumer spending, rising unemployment and a cooling housing market. However, Governor Michele Bullock has made it clear that further rate increases remain an option if inflation stays too high.
Economists are also closely watching global developments, including tensions in the Middle East, which could keep inflation elevated and delay any move to lower rates.
While ANZ, NAB and Commonwealth Bank believe rates have reached their peak, AMP and Westpac are forecasting up to two more rate hikes, potentially lifting the cash rate to 4.85 per cent by the end of the year.
Higher borrowing costs continue to put pressure on Australian households. More than 1.5 million mortgage holders are estimated to be experiencing mortgage stress, while over 65,000 people have already contacted the National Debt Helpline this year, with mortgage repayments remaining the leading concern.
Source : 9 News
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