Economy, interest rates: RBA expected to raise rates, recession fears
An impending 10th rate hike has fueled fears that Australia is on the brink of a recession as Jacqui Lambie warns voters to prepare for the worst.
The Reserve Bank is expected to raise its official cash rate to a decade high of 3.6 percent when its board meets later this week.
National accounts figures released last week showed that the Australian economy grew just 0.5 percent in the last three months of 2022.
It was well below what economists had predicted, raising concerns that there was a real risk of the economy contracting this year.
Senator Lambie told Nine that she had been urging people to tighten their belts in case a recession hit for some time.
“I think they’re holding on to every penny they can. I’ve been brutally honest. I said, ‘Well, even if we don’t, at least be prepared,'” she told Nine.
“I’d rather give them the bad news and say we’re more than likely going into a recession instead of waiting for that day to come.”
The Tasmanian senator said that while it wasn’t all bad for the economy, Australians would be in real trouble if unemployment rose.
“Unemployment is still low. If that rises, we’re screwed,” Senator Lambie warned.
The big four banks – the Commonwealth, Westpac, ANZ and NAB – have all forecast a dismal year as the RBA tries to contain runaway inflation.
Inflation hit a three-decade high of 7.8 percent in December, well above the RBA’s target of between 2 and 3 percent.
But concerns that interest rates could return to the high levels of the 1990s were unfounded, the treasurer said.
“There is absolutely no chance that interest rates will get to (that) level… I want to make that clear,” he told Nine’s 60 Minutes.
Data released by the Australian Bureau of Statistics on Friday suggests that the rising cost of living has driven the number of people holding multiple jobs to an all-time high.
About 925,000 Australians, or 6.8 percent of all workers, now have more than one job.
Employment Minister Tony Burke said that while there are always people interested in combining multiple jobs, he is concerned that the increase is due to people “trying to keep a household together”.
“However, it’s more and more people trying to keep households together who have to work multiple jobs to make ends meet,” he told ABC’s Radio National.
“Part of the problem here is where full-time jobs or part-time jobs are available with regular decent hours, people are only offered very short shifts and precarious work.”