PHOTO: Karl Stefanovic and his wife Jasmine Yarbrough. FILE
Karl Stefanovic Criticizes Reserve Bank for Neglecting Struggling Australians Amid Rate Rises
In a fiery critique, Karl Stefanovic, the popular host of The Today Show, unleashed scathing remarks against the Reserve Bank of Australia (RBA), accusing them of showing indifference towards the millions of Australians grappling to hold onto their homes amidst a series of interest rate hikes. Stefanovic’s strong words came ahead of the RBA’s July meeting, during which the cash rate was maintained at an 11-year high of 4.1 percent.
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This decision marked the first pause since April, following a staggering 12 consecutive interest rate increases since May of the previous year. Stefanovic didn’t mince his words, asserting that the RBA demonstrated a lack of concern for the countless families facing the daunting challenge of mortgage payments amidst overwhelming financial pressures.
Aussies Struggling as RBA Remains Unyielding
“They have single-handedly crushed, strangled Australian households,” Stefanovic vehemently expressed, highlighting the plight of hardworking Australians who diligently fulfill their obligations, only to find themselves at the mercy of mounting financial burdens. He went on to say, “Everything you have built is now on the line because our central bank missed the inflation tidal wave. What’s worse is that it’s not the respective governments’ overspending burden; it’s you at home. It’s you trying to put food on the table, pay your power bills, and keep a roof over your family’s head. It’s no wonder it’s breaking Aussies’ spirits right now.”
During its recent meeting, the RBA opted to maintain the interest rates at the aforementioned 11-year high of 4.1 percent. Governor Philip Lowe indicated the possibility of further monetary policy tightening due to persistently high inflation, even after the most aggressive rate hikes since 1989.
Mortgage Repayments at Risk
However, even without additional rate increases, mortgage repayments remain at risk of escalating. For instance, an average borrower with a $600,000 mortgage on a variable rate would face annual repayments higher by $17,556 compared to just 14 months ago. Monthly mortgage payments have surged by a staggering 63 percent, now amounting to $3,769, up from $2,306. This surge is primarily attributed to the Commonwealth Bank’s variable rate, which climbed to 6.44 percent for borrowers with a 20 percent deposit, a significant rise from the previous rate of 2.29 percent.
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In April, the RBA’s own financial stability review estimated that 15 percent of borrowers would face “negative spare cash flow” this year, where mortgage repayments and essential living expenses would exceed their after-tax income. AMP chief economist Shane Oliver warned that this could result in severe mortgage stress for approximately one million borrowers by Christmas. Oliver attributed this situation to RBA modeling, which was based on the expectation of the cash rate falling to 3.75 percent, a target that has long been surpassed. He emphasized, “We are now seeing increasing evidence that rate hikes are biting.”