Could the RBA’s rate rise send Australia into recession?

Could the RBA’s rate rise send Australia into recession?

From 7am by Solstice Media

May 5, 2026 · 16 min · Episode 1905

About this episode

The episode discusses the implications of the Reserve Bank's interest rate hike on Australians and the economy.

The Reserve Bank has raised interest rates again. The cash rate is now 4.35%, after the third rate hike in a row.  For Australians already stretched by the cost of living, it means another hit to mortgage repayments, rents and household budgets.  And while the decision was widely expected, the reason behind it is more complicated. Some economists are calling it the “Hormuz hike”, a response to global oil prices, the war in Iran and fears inflation could skyrocket. Today, economist and co-CEO of the Australia Institute, Dr Richard Denniss, on why the Reserve Bank is making Australians pay more to contain inflation, and the risk that it goes too far.    If you enjoy 7am , the best way you can support us is by making a contribution at 7ampodcast.com.au/support .   Socials: Stay in touch with us on Instagram Guest: Economist and Co-CEO of the Australia Institute, Dr Richard Denniss Photo:  AAP Image/Dean Lewin See omnystudio.com/listener for privacy information.

People in this episode

Guest: Dr Richard Denniss

Topics covered

  • interest rates
  • economy
  • inflation
  • mortgage repayments
  • cost of living
  • Australia

Keywords

  • RBA
  • interest rates
  • recession
  • inflation
  • economist
  • mortgage
  • cost of living

Mentioned in this episode

Organizations: Australia Institute, Reserve Bank

Places: Australia

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