The Reserve Bank of Australia has once again raised the cash rate, its 12th increase since May last year.
While many speculated a halt in rate rises, it increased by 25 basis points to 4.1% when it met on June 6.
According to RateCity.com.au the most recent rate rise will cost the average Australian homeowner an additional $70 a month.
RBA Governor Philip Lowe says the move is necessary to try and control inflation.
“Inflation in Australia has passed its peak, but it is still too high, and it will be some time yet before it is back in the target range,” he says.
“This further increase in interest rates is to provide greater confidence that inflation will return to target within a reasonable timeframe.”
While Lowe says there are signs the economy is slowing, inflation is still far outside of its target band of between 2% and 3%.
But he says rising rates and higher costs of living mean household spending will slow which will help ease inflation.
