Westpac now expecting an extra rate rise next year taking cash rate to 3.6 per cent by February

Borrowers are in for more bad news with Westpac expecting an extra interest rate next year to tackle the worst inflation in three decades.

The bank’s chief economist Bill Evans has revised Westpac’s forecasts to have the Reserve Bank of Australia raising the cash rate to a 10-year high of 3.6 per cent by February next year.

Previously, Westpac was expecting a 3.35 per cent cash rate, with its new prediction at the top end of what the Big Four banks are expecting.

Westpac sees the RBA cash rate hitting the highest level since June 2012. 

Should Westpac’s forecasts come true, a borrower with an average $600,000 loan would be owing $1,116 more a month to the bank in repayments, compared with early May when the cash rate was still at a record low of 0.1 per cent. 

Compared with now, this borrower would owe an extra $456 a month by February, as their repayments climbed to $3,422 from $2,966.

As recently as May, this borrower would have owed $2,306 a month paying off a typical loan with a…

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Written by Bourbiza Mohamed

A technology enthusiast and a passionate writer in the field of information technology, cyber security, and blockchain

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