Sydney opera, Performing arts centre in the City of Sydney, Australia

Sydney, May 4 After dropping interest rates down to historic low levels during the Covid-19 pandemic, the Reserve Bank of Australia (RBA) has lifted interest rates by 0.25 to 0.35 per cent, the first rise since 2010, in an effort to calm growing inflation.RBA Governor Philip Lowe said it was now "the right time" to withdraw accommodative monetary support designed to help the Australian economy through the pandemic, Xinhua news agency reported."The economy has proven to be resilient and inflation has picked up more quickly, and to a higher level, than was expected," Lowe added.Figures released by the Australian Bureau of Statistics last week showed inflation had reached a two-decade high of 5.1 per cent in the last 12 months.This has prompted widespread calls for the central bank to step in to deal with inflation that has begun to stretch the budgets of Austral.The RBA Governor said while the Reserve Bank expects further rise in inflation in the short-term as supply-side demand is resolved, inflation is expected to return to the RBA's target of 2 to 3 per cent."The central forecast for 2022 is for headline inflation of around 6 per cent and underlying inflation of around 4.75 per cent, by mid-2024," he added.Professor Peter Swan from the University of New South Wales's Business School told Xinhua on Tuesday that the move defied expectations of a 0.10 increase."You'd think it would take them 10 months to go up one per cent ... it's setting now the expectation that interest rates will move up very rapidly, and much faster than anyone expected."He added that at this rate it would mean interest rates would increase by 1 per cent every four months, which for a typical Sydney mortgage holder would add about 450 Australian dollars (about $320) to their mortgage payments, and 900 Australian dollars (about $640) by the end of the year."That's going to be politically painful, because one and a half million homeowners have never encountered interest rate rises before."Swan said Australia's inflationary troubles would not be a quick fix, and interest rates would likely need to reach 2 to 3 per cent before they start having an effect.Disclaimer: This post has been auto-published from an agency feed without any modifications to the text and has not been reviewed by an editor

Sydney OperaFOLLOW

Sydney opera, Latest News

San Francisco, May 7 Music streaming service Spotify has confirmed that its lightweight listening app Spotify Stations will ... ...

Mumbai, May 7 Australian Test skipper and KKR's strike bowler Pat Cummins has asked the Ind to redouble ... ...

Canberra, May 5 A majority of Austral voters want the government to do significantly more to reduce carbon ... ...

Canberra, May 5 Australian flag carrier Qantas on Thursday announced it has struck a A$614 million ($444 million) ... ...

Mumbai, May 5 2022 is another Men's T20 World Cup year, this time to be held in Australia. ... ...

Registrations are now open for International Virtual Open Week at the University of Technology Sydney (UTS). This four-day event is expected to drive demand for higher education as international students return to Australia after two years of strict ...

India under new captain Rohit Sharma finished the 2021-22 season as the world’s number one ranked T20 team after ... ...

Sydney, May 4 After dropping interest rates down to historic low levels during the Covid-19 pandemic, the Reserve ... ...