Australia raises cash rate to 4.85% in fifth increase this year

Australia’s Reserve Bank has raised its cash rate by 0.25 percentage points to 4.85 per cent, the highest level since 2008, as it seeks to curb persistent inflation. The fifth increase this year will raise mortgage repayments and add pressure to households already facing high borrowing costs.

Canstar estimates that a borrower with a $600,000 mortgage will pay about $92 more each month after this rise, or $456 more across the five increases this year. The average new owner-occupier loan is now $731,000, compared with $254,000 in 2008, while the median property price is $884,855. Macquarie said it would lift variable home loan rates by 0.25 points from 19 November; separate analysis cited in the article says the big four banks make an average $12,200 profit in the first year of a typical new owner-occupier loan.