Prominent ABC finance commentator Alan Kohler has warned that Australia risks tipping into recession and suffering its worst housing downturn in decades if the Reserve Bank raises interest rates again this month, prefacing the forecast with an apology for delivering such bleak news. His comments follow a revised prediction from HSBC chief economist Paul Bloxham, who now expects house prices to fall by as much as 13 per cent, up from an earlier estimate of around 10 per cent, amid speculation the central bank could hike rates further.

Kohler said consumer confidence had dropped five per cent and business conditions had turned negative for the first time since the pandemic, arguing that a rate rise in September, and potentially another in November, would likely push the economy into recession given how weak sentiment already is. The cash rate currently stands at 4.35 per cent and could rise to 4.6 per cent, its highest since 2011, with inflation still running above the Reserve Bank's target at 3.5 to 3.6 per cent. Deputy Governor Andrew Hauser stopped short of confirming a rise was certain, while separate figures showed $34.1 billion had already been wiped off Australian property values in the June quarter, against a backdrop of a $12.7 trillion housing market and growing concerns over housing affordability for younger buyers.