Interest rates are expected to rise today
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What is the main topic discussed in this episode?
This is a squeeze podcast. Where your shortcut to being informed.
Good morning, I'm Andrew Williams. And I'm Anna Pikett. It's Tuesday, the 29th of September. In your squiz today, interest rates are likely to go up today. Greens leader Larissa Waters has resigned. Moths are invading the east coast of Australia and Madonna has cleaned up at the video music awards. This is your squiz today.
Why is the Reserve Bank expected to raise interest rates, and how will it affect mortgages?
We're going to be hearing a lot about the economy today as the Reserve Bank announces its latest interest rate decision. Two thirty PM Eastern Standard Time today. Pretty much everybody, economists, yep, banks, yep, analysts, yep, have all predicted that a rise is on the card. So this is gonna get a lot of attention as the day goes along, Anna.
Yes, and that's because if the RBA does increase interest rates by 25 basis points, it would be the fourth rise this year and it would move the rate up to 4.6%. Now that's the highest it's been since 2011 when Julia Gillard was prime minister. Andrew, I was actually reading a piece in the Australian Financial Review this morning, and it said: if this happens, only one advanced country in the world will have high. Higher interest rates. Can you guess which? Uh South Korea. I've put you on the spot there. No, you're wrong. It's Iceland. Um buy a hemisphere. I was gonna say close, not not really. Not really. Not really close. Not really close. Not really close. Not really close in any way. But I did put you on the spot.
But anyway, what this would mean is that mortgage holders with variable rate home loans will be paying more on their monthly repayments, adding to cost of living pressures, which we've been talking about all year. Yeah.
And if you're a renter, you're not immune from this either. Landlords could pass on their higher mortgage costs by jacking up rents, so keep an eye on that. We also know that both the federal government and state governments have been racking up a lot of debt, and higher interest rates means that the cost of servicing that debt, paying off the interest on it, will get more expensive as well.
How are inflation, fuel costs and government spending shaping Australia's interest rate outlook?
So, as for why all of this is happening, uh, the Reserve Bank wants to bring inflation back inside its target range of two to three percent. Right now it's at three point five percent, and basically putting the squeeze on household budgets by lifting rates is how it does that.
Yeah, Federal Treasurer Jim Chalmers says there are several factors at play here. He's calling out rising fuel costs and inflation, which have been made worse by the US's war with Iran in the Middle East. I was watching him on 730 last night and he defended the government's record on inflation but acknowledged that there is more work to do. Despite yesterday revealing an improvement to the federal budget bottom line, he reported a deficit that was six six billion dollars lower than the previous forecast that was made back in May.
Nonetheless, the coalition has criticized the government's approach to the economy. Its Treasury spokesman Tim Wilson said another rate rise would push a lot of families and businesses, in his words, over the edge. And he says, as he said a lot so far this uh year, that high government spending is the problem when it comes to inflation. So, as for whether this will be the last rate rise of 2026, there's new inflation data due tomorrow that might give us a steer on that. The next interest rate decision. after this one is Melbourne Cup Day, which is the first Tuesday in November.
What is the latest on the UK investigation into an alleged terror plot?
We mentioned yesterday that five suspects in an alleged terror plot in the UK had been arrested overnight and uh they've all been released on bail.
But this doesn't mean that investigation into them is over. They're still under quite strict movement rules, so they can't just um jet off anywhere they fancy. Yes. We've learned a bit more about who they are. The head of counterterrorism policing in the UK, Lawrence Taylor, says they're all British nationals in their twenties from different parts of London. Officers are looking into the possibility that they could be proxies or working on behalf of a foreign
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Chapters
8 chapters
1
What is the main topic discussed in this episode?
0:00–0:29
2
Why is the Reserve Bank expected to raise interest rates, and how will it affect mortgages?
0:29–1:54
3
How are inflation, fuel costs and government spending shaping Australia's interest rate outlook?
1:54–3:09
4
What is the latest on the UK investigation into an alleged terror plot?
3:09–4:07
5
Why has Greens leader Larissa Waters resigned, and who could replace her?
4:07–4:56
6
Why are Bogong moths swarming Australia's east coast, and how can people help track them?
4:56–6:29
7
Which awards did Madonna win at the MTV Video Music Awards?
6:29–7:12
8
What did Taylor Swift win at the VMAs, and where can fans watch her new music video?
7:12–9:20