Finance guru, Mark Bouris, has slammed the Reserve Bank of Australia’s (RBA) latest interest rate rise, saying the country is heading towards a recession.
The RBA delivered its twelfth interest rate rise in just 14 months, with the cash rate now sitting at 4.1 percent after an increase of 25 basis points.
The rate hike means Australian borrowers now face the heaviest mortgage repayment burden in history, with financial experts estimating that the rate hike will set Aussies back by an additional $1,200 every month.
“I am concerned we are going to get squeezed very, very hard,” Bouris told Today. “I definitely think we are going to head towards a recession, a technical recession at least.”
“Small businesses are going to suffer because most of the owners have rates or a property and their rents are going up.”
In an Instagram video after the rate rise, Bouris added that the RBA’s move could “be the nail in the coffin” and predicted a wave of mortgage defaults and ‘desperate’ house selling.
This comes as RBA governor Philip Lowe warned this week that further rate rises were on the cards “to ensure that inflation returns to target in a reasonable time frame.”
Federal Treasurer Jim Chalmers said a lot of Australians would find the rate decision “difficult to understand and difficult to cop,” but added he did not want to “second guess” the RBA.
Source: Today.
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