RBA’s “new look” meetings could mean more drastic rate increases

An economist from RMIT University is available to talk about the outcome of the RBA’s first “new look” meeting for 2024.  

Dr Nataliya Ilyushina, Research Fellow, Blockchain Innovation Hub and ARC Centre of Excellence for Automated Decision-Making and Society 

Topics: RBA, interest rates, cost of living, tax cuts, inflation 

“Rising rates and prices in Australia are causing widespread financial distress and many are looking toward the RBA for a solution. 

“While many are hopeful for some relief soon, there are some predictions that the rates may stayat their current high for as long as the next five years.  

"If this is the case, mortgage repayments will not be sustainable long term.   

“Less frequent meetings by the RBA may mean the rate changes could be more drastic each time.  

“On one hand, if they do not raise the rate there will still be little relief on the cost of living such as rising grocery prices, petrol and other essentials.  

“On the other hand, if they continue to raise it the homeownership “dream” will continue to be a nightmare for many. 

“While the newly introduced tax cuts are designed to ease some financial strain on lower income households, they are barely going to offset the cost of living pressures felt by the masses.   

“Many of the cost of living increases are non-discretionary, meaning people don’t have a choice about where they feel the pinch.  

“Hopefully, the RBA can work out a balance that will eventually see both inflation and rate decrease – or at least slow down – in the coming years, if not months.  

“Additionally, it will be interesting to see if the government’s report on price gouging will prompt any drastic changes to the cost of groceries, electricity and airfares.” 

Dr Nataliya Ilyushina’s research investigates decentralised autonomous organisations and automated decision-making, and the impact they have on labour markets, skills and long-term staff wellbeing.