The country’s largest lender Commonwealth Bank is tipping the Reserve Bank will push the official interest rate to 2.6 per cent by year’s end.
Australia’s largest lender, Commonwealth Bank, is tipping the Reserve Bank will push through two more 0.5 percentage point interest rate rises in August and September, with a final push to 2.6 per cent in November.
Mr Aird said higher rates would begin to bite as the huge numbers of fixed-rate loans come to an end in the next 12 months. About 40 per cent of the value of CBA and Westpac’s mortgage book is locked in, RateCity said.“The impact on households with a mortgage will be very significant given the percentage change in the mortgage rate will be incredibly large,” Mr Aird said.
AMP Capital’s Shane Oliver, Jarden’s Carlos Cacho and Vanguard’s Alexis Gray think there is a clear risk of 75 basis points if the June quarter inflation figures due out on July 27 are higher than expected.
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