Hefty monthly hit households face if RBA hikes rates again

Households could be set to take yet another cost of living hit with economists and markets offering a grim prediction on the possibility of the Reserve Bank hiking interest rates.Economists and markets are tipping the Reserve Bank to"certainly consider" hiking interest rates in August, slugging households with yet more cost of living pain.

Speaking to Sky News Australia's Business Now on Thursday, senior NAB economist Gareth Spence explained that if inflation for the July quarter met expectations, that would leave the RBA in a difficult position given it would mark"a six month period with very little or no progress" on lowering prices.

That view is broadly reflected by markets, which have gone from pricing in the chance of a hike at about ten per cent just weeks ago to now pricing the chance at 40 per cent. While opinion on the chance of multiple hikes is split for the time being, analysis from Compare the Market revealed even a single rise would see households cop a hefty hit to their monthly budgets.

Households with a $500,000 mortgage had seen an increase of $1,293 per average monthly repayment, while those with a $600,000 mortgage saw a $1,552 jump and those with $750,000 loans were hit with a $1,940 rise.

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