If you thought inflation was bad after last week’s red-hot report dashed hopes of an interest rate cut in Australia, a cohort of economists is warning that it will get much worse unless the central bank steps in.
That’s because the real interest rate – the Reserve Bank of Australia’s cash rate minus inflation – has slid to near zero and is quietly encouraging a borrowing spree that has pushed lending and house prices to record levels.
Source: https://www.afr.com/markets/debt-markets/why-the-rba-s-rate-decision-will-only-make-inflation-worse-20251031-p5n6qr