Sally Tindall

I'm good, James.

Yeah, it's an interesting one because the RBA is in a very difficult position at the moment.

They already had an inflation problem on their hands.

Inflation, they never got the genie back into the box.

And now the war in Iran has really put a rocket under what was already a plan to hike.

You turn back to rate hikes and continue with that.

So we've seen two rate hikes already, one in February, one in March.

Westpac's economic team now forecast in

three more, that would take our cash rate to, what, 4.85%.

That would be the highest setting since, what, 2008 when we were coming back off the GFC.

It would be an extreme setting given the circumstances.

There's no guarantee, though, that will happen.

There is broad consensus that we will see at least one more in the meeting that's coming up in about two weeks' time.

But the RBA is really struggling with a conundrum here because they're ramping up the screws on households, right?

Households with a mortgage, that is, in order to stop us spending.

But really, when you look at things like consumer confidence, which is at the lowest or the fourth lowest setting...

Since the records began, and I was looking at the ANZ data just before, I think it's since the 70s, right?

It's incredible to see we've already shut our plastics.

Households have already zipped them up tight because of the unknown that's coming from the war because of the higher petrol prices.

So it's really interesting to see the RBA opt to hike the cash rate.