A UK research report has found a growing number of couples over 60 live in separate households, a trend particularly pronounced among those entering a new relationship at this stage of their lives. Improved mental health is a bonus.
Speakers of the calibre of David Knoff, the expedition leader stranded with his team in Antarctic during COVID, can regularly be heard at this global institution that places a premium on knowledge, not qualifications.
RBA lifts interest rates 50 basis points to 1.35%
The Reserve Bank of Australia (RBA) increased interest rates on Tuesday by another 50 basis points, bringing the cash rate to 1.35 per cent as it attempts to rein in soaring inflation.
It is the third consecutive increase by the central bank, following 25 basis points in May and 50 basis points in June. The RBA cautioned that it is resolute in taming inflation, despite admitting global factors “account for much of the increase”.
Pandemic-induced supply chain bottlenecks, the war in Ukraine and robust commodity prices have all contributed to inflation reaching 5.1 per cent in Australia.
“Strong demand, a tight labour market and capacity constraints in some sectors are contributing to the upward pressure on prices”.
“The Board is committed to doing what is necessary to ensure that inflation in Australia returns to target over time”.
A careful balancing act
The Australian economy remains resilient. Unemployment is at a 50-year low of 3.9 per cent. Job vacancies and ads remain high, while households have still accumulated a significant amount of excess savings.
Nonetheless, the board noted one source of ongoing uncertainty is household spending. Budgets are under pressure from inflation. Furthermore, increasing borrowing costs have led to house prices turning, with Melbourne and Sydney leading the fall.
For a household on a $500,000 loan, the 50 basis point increase will add upwards of $300 per month to a standard variable rate mortgage repayment.
A quarterly survey conducted by the Australian Financial Review of 31 economists anticipates a median cash rate of 2.35 per cent by December.
“The Board expects to take further steps in the process of normalising monetary conditions in Australia over the months ahead”.
Inflation remains the elephant in the room
The RBA will next meet on August 2, with the 30-day futures curve suggesting another 50 basis point rise would be on the cards.
“The size and timing of future interest rate increases will be guided by the incoming data and the Board’s assessment of the outlook for inflation and the labour market”.
A number of key economic indicators will be released before August’s meeting including quarterly Buildings Activity on July 13 and monthly labour force data on July 14.
However, the most closely watched report will be the quarterly Consumer Price Index and subsequent inflation data released on July 27.
The RBA expects inflation to peak later in 2022 before declining towards its target band of 2-3 per cent next year.
“Medium-term inflation expectations remain well-anchored and it is important that this remains the case”.
Later this year inflation numbers will begin to lap prior year’s comparisons. While prices may remain high, the RBA will be hoping the elevated inflation readings begin to soften.
Information warning: The information in this article was published by The Rask Group Pty Ltd (ABN: 36 622 810 995) is limited to factual information or (at most) general financial advice only. That means, the information and advice does not take into account your objectives, financial situation or needs. It is not specific to you, your needs, goals or objectives. Because of that, you should consider if the advice is appropriate to you and your needs, before acting on the information. If you don’t know what your needs are, you should consult a trusted and licensed financial adviser who can provide you with personal financial product advice. In addition, you should obtain and read the product disclosure statement (PDS) before making a decision to acquire a financial product. Please read our Terms and Conditions and Financial Services Guide before using this website. The Rask Group Pty Ltd is a Corporate Authorised Representative (#1280930) of AFSL #383169
