“Many experts in the industry expected the RBA to increase the cash rate in June, but a relatively large jump of 50 basis points is still quite alarming as we predicted a more steady increase over the next couple of months,” Catherine Mapusua, Head of Lending at Australian digital lending and payments provider WLTH said.

“Australian households are commonly highly leveraged so if lenders pass on the full rate, then some borrowers may need to drastically adjust their budgets sooner rather than later.

“This isn’t the end of the rate hikes. Fixed rates that were once attractive at the start of the year no longer seem like viable options moving forward.

“Those who are concerned about their repayments may need to be more conservative about their spending and consider refinancing their current loans. Borrowers should be contacting their lenders to consider their options and find the right solution for their personal situation.”

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