Low income and younger households will bear the brunt of the Reserve Bank of Australia’s expected tenth straight interest rate rise this week, and they will be forced to slash spending as their discretionary income shrinks.
Low income and younger households will bear the brunt of the Reserve Bank of Australia’s expected 10th straight interest rate rise this week, and they will be forced to slash spending as their disposable income shrinks.
While low-income earners hold a relatively small share of total household debt, they are as heavily leveraged as any income quintile. utilities take up a large share of their income and from the perspective that they have little other by way of assets or financial buffers,” Mr Toohey said.cash flows will turn negative if, as expected, there is a 10th rise in the official cash rate to 3.6 per cent.
RBA governor Philip Lowe has admitted interest rates are a “blunt” instrument hitting some cohorts harder.Market economists“GDP data revealed a further slowing of domestic demand, and evidence of less intense wage and price pressures,” Nomura senior economist Andrew Ticehurst said.
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