Australian mortgage holders brace for rates decision

CANBERRA: The Reserve Bank of Australia’s September cash rate decision will dominate the week’s economic news alongside economic growth figures due midweek.

There will be a few key data releases before the central bank’s board meets tomorrow, including business indicators for the June quarter from the Australian Bureau of Statistics.

Melbourne Institute’s monthly inflation gauge and ANZ’s job advertisements report will also be released today.

Tomorrow, mortgage holders will be eyeing the official cash rate decision nervously, with another hike broadly expected.

In a survey by Finder, most economists and analysts (23 out of the 36 questioned) predict a 50basis point hike. This will take the cash rate to 2.35%.

However, the bulk of experts (25 out of 36) also expect the September hike to be followed by a hold in October.

The survey comes as the Greens call on the Reserve Bank to pause any interest rate rises until after the October budget to put pressure on the Government to limit inflation by tackling corporate profits and providing costofliving relief.

‘‘This is not the 1970s. We have a profitprice spiral, not a wageprice spiral,’’ Greens economy spokesman Nick McKim said in a statement yesterday.

‘‘Instead of jawboning down wages, [RBA governor] Philip Lowe should be jawboning down corporate profits and heaping pressure on the government to do something about [inflation].’’

While the central bank has warned of more hikes to come, some experts have predicted the bank will pause its aggressive tightening next month to see how the market is responding.

‘‘The rate increases in recent months are yet to be fully felt by the market so we believe there’s a case for the Reserve Bank to take stock of the impacts to date,’’ Laing+Simmons director Leanne Pilkington said.

The ABS will release its national accounts report, which includes the key gross domestic product numbers, for the June quarter on Wednesday.

Commonwealth Bank economists are predicting the economy to have grown by 0.8% in the quarter, while NAB’s chief economist Alan Oster expects a 0.7% quarterly increase.

On Thursday, the RBA’s Lowe will deliver a speech on the economic outlook and monetary policy at the Anika Foundation in Sydney.

The ABS will also release trade data as well as payroll jobs figures.

At the end of the week, the National Skills Commission will provide a preliminary update on job vacancies for the month.

The national statistics bureau will also release ‘‘monthly business turnover indicator’’ data on Friday.

Meanwhile, the Australian stock exchange was expected to open lower today after Wall Street ended down on Friday amid ongoing worries about the European gas crisis. — AAP