{"id":532240,"date":"2026-03-11T01:38:08","date_gmt":"2026-03-11T01:38:08","guid":{"rendered":"https:\/\/www.newsbeep.com\/au\/532240\/"},"modified":"2026-03-11T01:38:08","modified_gmt":"2026-03-11T01:38:08","slug":"aussies-brush-off-rba-rate-rise-fears-as-confidence-levels-jump","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/au\/532240\/","title":{"rendered":"Aussies brush off RBA rate rise fears as confidence levels jump"},"content":{"rendered":"

Aussies\u2019 concerns the economy will continue to struggle in the near future are failing to dampen spirits, with an uptick in consumer confidence recorded during March.<\/p>\n

The latest Westpac-Melbourne Institute Consumer Sentiment Index shows people are feeling more positive despite the\u00a0February interest rate hike<\/a>, up 1.2% to 91.6 for March.\u00a0<\/p>\n

Despite rising inflation in recent months, markets are largely anticipating the Reserve Bank will hold off on more tightening<\/a>\u00a0when the board meets next week.<\/p>\n

Head of Australian macro-forecasting Matthew Hassan said consumers \u201care seeing a slight improvement in current conditions\u201d this month, with much of that view centred on the outlook for interest rates.<\/p>\n

The index factors in how borrowers feel about the short- and medium-term economic outlook, the timing of spending decisions, and how their family finances stack up compared with 12 months ago.<\/p>\n

Though people are feeling more positive compared with earlier in the year, expectations for a harsher rate environment are high.<\/p>\n

\"ECONOMIC<\/p>\n

Consumers agree the RBA will hike rates further this year. Picture: NewsWire\/John Appleyard.<\/p>\n

\u201cThere remains a strong consensus view that interest rates will rise further from here,\u201d Mr Hassan said.<\/p>\n

The Westpac-Melbourne Institute Mortgage Rate Expectations Index, which tracks consumer expectations for variable mortgage rates over the next 12 months, declined 3.9% in March.<\/p>\n

This gives back around a quarter of the surge seen in February, though expectations for higher repayments are locked in.<\/p>\n<\/p>\n

\u201cOver 75% of consumers expect mortgage rates to increase over the next 12 months,\u201d Mr Hassan said.<\/p>\n

Consumers are also showing less confidence in the outlook for the labour market, reflective of RBA governor Michele Bullock\u2019s recent\u00a0comments around the difficulties the bank is facing\u00a0<\/a>with reliably forecasting.<\/p>\n

An uptick of 3.8% on the index reveals more people expect unemployment to rise over the year ahead, a risk that could push the Reserve Bank to raise rates in order to balance its dual mandate to manage both.<\/p>\n

Ahead of the RBA\u2019s highly-anticipated decision next week, Mr Hassan noted war in the Middle East would likely keep the bank\u2019s hand steady.<\/p>\n

\u201cWhile we continue to expect that the most likely timing for the next rate rise is May, a hike is likely to be on the table for discussion at the March meeting,\u201d he said.<\/p>\n

\u201cDomestic developments have been mixed: growth coming in above the RBA\u2019s expectations in 2025 but with some better news on supply capacity and the latest sentiment survey suggesting momentum is cooling across the consumer sector.<\/p>\n

\u201cHowever, the global backdrop has become much more unsettled. The conflict in the Middle East has impacted energy supplies and is casting major doubts over the outlook for growth.\u201d<\/p>\n

The index shows the escalating conflict in the Middle East is concerning for Australians, with 90% of consumers seeing the news from abroad as \u2018unfavourable\u2019. This is compared to 74% three months ago.<\/p>\n

\"RBA<\/p>\n

RBA governor Michele Bullock says it\u2019s too early to know how Iran conflict will impact inflation in Australia. Picture: Martin Ollman<\/p>\n

Westpac noted the March readings are \u201cvery similar\u201d to those seen around the time of Russia\u2019s 2022 invasion of Ukraine.<\/p>\n

\u201cThe RBA will be wary about how an associated spike in petrol prices feeds into inflation locally but will also be wary about making policy changes in the midst of a rapidly evolving and uncertain situation,\u201d Mr Hassan said.<\/p>\n

\u201cOn balance we believe it will opt to leave rates unchanged in March with the next rate rise coming a little later, once the dust has settled a bit.\u201d<\/p>\n

This article first appeared on Mortgage Choice<\/a> and has been republished with permission.<\/p>\n","protected":false},"excerpt":{"rendered":"Aussies\u2019 concerns the economy will continue to struggle in the near future are failing to dampen spirits, with…\n","protected":false},"author":2,"featured_media":532241,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[64,63,99,164],"class_list":["post-532240","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-au","tag-australia","tag-business","tag-economy"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/532240","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=532240"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/532240\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/532241"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=532240"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=532240"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=532240"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}