Tasmanian average mortgage could rise more than $70 a month

A rise of that nature would lift the official cash rate to 3.6 per cent.

This could mean an interest rate rise of more than $70 a month for the average mortgage in Tasmania, which sits at $460,000.

This would follow the last rate rise of 0.25 per cent in February.

The Reserve Bank started lifting interest rates in May 2022, with its tenth rise to be announced at its annual meeting at 2.30pm on Tuesday.

Economics Society of Tasmania state president Dr Paul Blacklow said the economy was starting to slow, and it was time for the Reserve Bank to stop raising rates.

"We should almost be at the peak now but it does appear that we have at least one or two more rises coming. The Reserve Bank is quite wary of inflation and a wage price spiral," Dr Blacklow said.

But he added that Australia, unlike other countries, was not seeing wage inflation occur, which provided hope that the interest rate program would end soon.

"There is a little bit of wage growth in the private sector, a small bit in the public, but real wages are declining in the economy," he said.

"Other countries like the United States and New Zealand have quite high wage inflation and so it is harder for them to kill off inflation."

Dr Blacklow said it had been a very long time since rates had been this high.

Australia's highest interest rate sat at 17.5 per cent in 1990, with its lowest recorded in November 2020 at .10 percent.

"Those mortgage holders who are sitting on a variable rate will no doubt have that increase passed on very quickly, and they will see an increase to their mortgage repayments depending on how much they have borrowed," Dr Blacklow said.

"Those lucky people who are still on their fixed rates won't be affected at the moment but as soon as they get off the fixed rates to variable, it means their rates will go up even more.

"These rates could almost triple, instantly rising to 6.5 to 7 per cent, and that will obviously have a significant impact."

Our journalists work hard to provide local, up-to-date news to the community. This is how you can continue to access our trusted content: