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Concerns raised over impact of sustained high rates on economic growth

Published July 6, 2026 at 4:43 AM UTC

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Some economists and financial analysts express concern that the Reserve Bank of Australia's continuation of elevated interest rates, without cuts until 2027, may dampen consumer spending and investment, potentially slowing economic growth. They highlight that while controlling inflation is important, the cumulative effect of several rate hikes could strain borrowers and weaken demand in the housing market and other sectors. These experts call for careful monitoring of economic indicators to balance the risks of inflation against those of stifled growth, suggesting that the RBA should be prepared to adjust policy if signs of economic slowdown become pronounced.