Category Archives: Interest rates

Mortgage repayments are now cheaper than rent in some Australian suburbs. Is yours among them?

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As house prices plateau, the gap between the cost of buying and renting is narrowing in dozens of suburbs

High rents and falling property prices have opened a rare window for Australian tenants to become homeowners, with mortgage repayments cheaper than rent in dozens of suburbs.

Guardian Australia’s analysis of Cotality data shows that median rents in inner-city Melbourne, suburban Canberra and Darwin are now nearly matching weekly home loan repayments.

In one in 10 suburbs and towns across the country, repayments are less than $200 a week higher than rent, for the typical property. In some suburbs, they are actually cheaper.

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Tech market sell-off deepens amid fears over US inflation and AI debt

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Chip makers and tech investors such as Samsung and SoftBank plunge as potential interest rate hikes spook markets

An accelerating sell-off of AI-linked shares has hit global markets, as fears over rising inflation and future interest rate hikes spooked traders already wary of the heavily indebted sector.

South Korea’s benchmark Kospi 200 index, which is heavily skewed towards the companies that make memory chips, fell more than 8% overnight to a six-month closing low, triggering circuit breakers that brought trading to a halt at various points.

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Australian consumer confidence plunges to worst level since 1990s after RBA rate rise

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Key indicator dropped about 20% after the Reserve Bank last month announced the highest interest rates since 2011

Australian households are the most persistently pessimistic they have been since the early-1990s recession, after a fourth rate rise this year.

Confidence among Australian consumers has plunged about 20% since the Reserve Bank of Australia lifted interest rates to the highest levels since 2011, according to the Westpac–Melbourne Institute consumer sentiment index.

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Chalmers says global economic turmoil will drive budget cuts, but Australia should avoid recession

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Treasurer says ‘very substantial and intensifying pressure’ on federal budget as he points finger at private sector for driving up inflation amid Middle East conflict

Jim Chalmers has warned of “very substantial and intensifying” economic pressures on the horizon but insists he’s not planning for a recession, as he prepares to find new ways to cut the budget ahead of its mid-year update.

The treasurer on Sunday called on critics of government spending to name the services that should be cut, as he points the finger at the private sector for driving up inflation in Australia amid the protracted conflict in the Middle East.

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RBA expected to hike cash rate to 4.6%, its highest level since 2011

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Outcome of meetings of Reserve Bank on Monday and Tuesday will affect Australian mortgage rates, household budgets and house prices

Australia’s key interest rate is expected to hit its highest level since 2011, drag down house prices and add more than $100 to typical monthly mortgage repayments.

The Reserve Bank board is poised to hike the cash rate from 4.35% to 4.6% on Tuesday, which would be the fourth increase in 2026 and push typical home loan interest rates to 6.5%.

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Diesel prices across Australia could surge beyond $3 a litre as Trump eyes cut to US fuel exports

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Fuel costs have risen to levels not seen since early April, adding to risk of inflation and interest rate hike

Australian diesel prices could surge above $3 a litre if Donald Trump cuts off US diesel exports amid floundering negotiations with Iran.

Fuel costs have risen to levels not seen since early April, adding to inflation risks and making another hike in interest rates all but certain.

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AI could be a bubble and is not yet making Australia more productive, Michele Bullock says

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RBA governor says AI is ‘great white hope’ but its adoption is so far adding to inflation, rather than economic growth

The Reserve Bank governor said AI could be a bubble and there was no evidence it is making the economy more efficient, as the Albanese government claims the technology will solve Australia’s economic malaise.

Ahead of an expected interest rate rise next week Michele Bullock also said the slump in house prices was deeper than others in Australia’s recent history.

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Japan raises interest rates to 31-year high to curb impact of rising prices

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Increase from 1% to 1.25% follows US Federal Reserve and European Central Bank tightening monetary policy

Japan’s central bank has increased interest rates to a fresh 31-year high as it attempts to combat global inflation linked to the war in Iran.

The Bank of Japan voted to raise its target interest rate from 1% to 1.25%, the highest level since 1995.

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UK mortgage borrowers brace for rate jump amid global bond sell-off

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Swap rates rise to three-year high as increase in oil prices leads to fears of higher inflation

Homeowners in the UK are braced for a jump in mortgage rates, driven by higher inflation and interest rate increase expectations amid turmoil in the global bond markets.

UK swap rates, which lenders use to price mortgages, have risen to a three-year high, as this week’s global bond market sell-off ripples through the economy.

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Lending to property investors falls sharply in ‘tiny’ step towards fairer housing market in Australia, expert says

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ABS data shows an almost 9% slump in new lending to investors after three interest rate hikes this year

In what one economist is describing as a “tiny step” toward a fairer housing market after decades of bad policy, property investors are shying away from established homes, and putting money into new builds instead, new data shows.

New lending to property investors fell sharply in the three months to June, slumping almost 9%, ABS data showed, while the number of total new home loans dropped by 5.4% in the June quarter.

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UK inflation falls by more than expected to 2.6% in lift for Andy Burnham

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Annual June figure comes after new PM pledges to reduce cost of living and improve economy

UK inflation dropped by more than expected in June to 2.6%, in a boost for Andy Burnham’s plans to reduce the cost of living.

The new prime minister has pledged to bring down the cost of living to give households more disposable income and improve the outlook for the economy, announcing a winter VAT cut on electricity bills and lowering the cap on bus fares in England.

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IMF upgrades UK growth forecast as fears over impact of Iran war diminish

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July update projects GDP growth of 1% this year, making UK the third fastest-growing economy in the G7

The International Monetary Fund (IMF) has upgraded its growth forecast for the UK, while leaving those for other G7 countries weaker or unchanged, amid hopes the economic impact of the Iran war may be less severe than feared.

In a July update of its World Economic Outlook, which was finalised before the latest outbreak of hostilities in the Middle East, the Washington-based organisation projected UK gross domestic product to grow by 1% this year – up 0.2 percentage points from its April forecast.

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Bank of Japan raises interest rates to 31-year high … of 1%

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Country acts amid Iran war inflation pressures, but US Fed and Bank of England expected to hold rates

The Bank of Japan (BoJ) has raised interest rates to a 31-year high as it tries to dampen inflationary pressures created by the Iran war.

Policymakers in Tokyo raised the BoJ’s short-term policy rate by a quarter of one percentage point, to 1% from 0.75%, and warned that companies were passing on rising oil costs to each other at a “relatively fast pace”.

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RBA interest rates: Reserve Bank holds official cash rate at 4.35% as economy slows and unemployment rises

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Reserve Bank of Australia decision on Tuesday comes after three consecutive cash rate hikes this year

The Reserve Bank has warned it is ready to raise interest rates further despite leaving its official interest rate on hold at 4.35%.

The widely expected decision on Tuesday will bring little relief to mortgage holders, already strained by the RBA’s three consecutive rate hikes earlier in 2026.

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ECB raises eurozone interest rates as Iran war stokes inflation

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European Central Bank increases main deposit rate to 2.25%, with two further rises expected by next spring

The European Central Bank has raised interest rates for the first time since 2023 in response to higher inflation caused by the war in Iran.

The ECB raised its main deposit rate from 2% to 2.25% in a move that financial markets expect to be the first of three rises by next spring.

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Australian housing was already cooling before the budget – but how cold it gets depends on two key factors

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Most economists believe the chronic undersupply of homes will eventually push prices higher once interest rates ease and the tax changes are priced in

The government’s property tax changes have become one of the defining political issues of Labor’s second term, drawing fierce criticism from opponents who argue they represent an “assault on aspiration” that will destroy home values.

In the three weeks after the negative gearing and capital gains tax changes were revealed in the 12 May budget, housing data has begun to show how they may affect Australia’s property market. Here’s what the data shows, and what could happen next.

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Capital city home prices fall across Australia as experts predict slump could last a year and cut values by 10%

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Buyers abandon auctions and Sydney, Melbourne and Canberra median house prices end May lower than they were at the end of 2025

Home prices in Australia’s capital cities have begun to fall, with experts predicting the decline could last at least a year and wipe as much as 10% from values.

The median capital city home price fell in May, the first decline since January 2025, as high interest rates and inflation stretched buyer budgets, Cotality reported on Monday. Auction success hit a new low for the year.

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Australia’s property investor borrowing rises at fastest rate in a decade – despite interest rate rises

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Owner-occupier mortgage growth slowed under growing costs while investor loans grew by $42bn in the year to March, a 9.6% increase

Property investor borrowing rose at its fastest rate in a decade in March, according to the Reserve Bank, despite higher interest rates and speculation about property tax changes.

Owner-occupier loan growth slowed under the weight of growing mortgage costs but investor lending is continuing its record surge.

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News live: Bell says royal commission will look at ‘ugly displays of hostility’ towards Jewish Australians as hearings begin

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Meanwhile treasurer says next week’s budget will save more than it spends. Follow today’s news live

Jim Chalmers says next Tuesday’s budget will not extend the 26 cent fuel tax cut beyond June.

But with Australia “hostage” to the wild swings in global oil prices amid the ongoing US-Israel war on Iran, the treasurer said there was “a range of contingencies” prepared to help support households and the economy from any escalating damage as a result of the Middle East conflict.

The budget will be calibrated for the conditions, but it will also still be consistent with our ambitions.

The election began a year of delivery, and the budget will begin a year of more ambitious reform, reform which is made more not less, urgent by global inflation and global economic uncertainty.

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UK firms expect to raise prices more quickly as Iran war pushes up costs

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Bank of England survey in March shows chief financial officers foresee 3.7% increase over coming year

Companies in the UK expect to raise their prices more rapidly over the coming months as the war in the Middle East drives up costs, Bank of England research shows.

The Bank’s regular survey of more than 2,000 chief financial officers conducted last month, after the Iran conflict began, shows they now expect to raise their prices by 3.7% over the coming year.

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