RBA Cash Rate Hike Sparks Recession Fears

The Reserve Bank of Australia (RBA) has raised the cash rate to 4.6 per cent, its highest level in 15 years.

This move was widely expected due to persistent inflation and rising Middle East oil prices.

RBA Governor Michele Bullock stated that the rate hike was necessary to bring down inflation, but conceded that a recession is possible if inflation expectations get out of control.

Economist Cherelle Murphy from EY Oceania noted that the reasons behind high inflation are difficult to reverse and further rate hikes cannot be ruled out.