Australian households have rebuilt their mortgage buffers to withstand further interest rate increases and a prolonged conflict in the Middle East, according to the Reserve Bank’s semi-annual health check of the financial system.
The improved financial health of borrowers who are, on average, more than a year ahead of their mortgage payments, suggests that the risk of aggravating household stress is no impediment for the central bank in increasing the cash rate to a 15-year high of 4.6 per cent, as markets are forecasting.
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