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The Reserve Bank is about to raise the cash rate again...

The Reserve Bank is battling the worst inflation outbreak in decades, and the financial markets are banking on a better-than-even chance that it will increase its cash rate by another 0.5 percentage points on Tuesday.

The financial markets, for one, are betting on a better-than-even chance the Reserve Bank will again raise its cash rate by another 0.5 percentage points on Tuesday as it — and other central banks — wrestles with the worst inflation outbreak in decades.

On the flip side, there is the possibility for lasting, meaningful and positive change in the Australian economy, the likes of which we haven't seen since the 1980s.

But boy, oh boy are there some challenges.



1. When it comes to taking action on climate change, Australia is about ten years behind most of the rest of the world.

2. Federal and state energy ministers are working on changing the way we mine, process, and distribute natural resources to power the country.

3. Businesses are desperate for more skilled workers, and the latest Bureau of Statistics data on employment shows that many have had to cut services because they couldn't find enough workers. This has caused more people to lose their jobs.

4. And, of course, wage growth remains stubbornly low.

5. Cost of living, or inflation, is going up, which makes other economic problems worse and makes it more important to fix these problems.

6. The pain is made worse when the main way to deal with the cause of the problem is inflation, tighten monetary policy, which means raising interest rates.

7. Just think about it: Australians are, for lack of a better word, are encouraged to spend less. We haven't been able to respond as expected, so the Reserve Bank may have to keep the restraints tighter for longer.

The market reaction to this has just started.

Check the full article here and learn how it can affect your business!


Please do not hesitate to contact us if you wish to discuss any of these matters further.

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