Australia braces for fifth rate hike as economy faces sharper slowdown

· Economy · Australia

Australia's central bank is expected to raise interest rates for the fifth time on Tuesday, with major bank economists predicting a "sharper, longer slowdown" as the war in the Middle East combines with collapsing house prices. The Reserve Bank is being forced to tighten policy to contain inflation even as growth weakens, putting pressure on mortgage holders. The combination of conflict-driven energy costs and a housing downturn is dampening consumer confidence.

Why it matters：Australia's policy tightening shows how the Iran war's energy shock is forcing central banks to fight inflation even as growth slows.

Key points

  • The Reserve Bank is expected to raise rates for the fifth time.
  • Economists predict a "sharper, longer slowdown".
  • Collapsing house prices and Middle East war costs are weighing on the economy.

Sources (original reporting)

More stories from this day