Surprise scenes as protesters march on RBA before interest rate cut
Unions and interest groups ratcheted up the pressure on the Reserve Bank ahead of its decision to cut interest rates.
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Unions and interest groups took to the streets ahead of the Reserve Bank’s long-awaited - and “well-deserved” - decision to cut interest rates on Tuesday.
In a widely expected move, the RBA cut the official cash rate from 4.35 to 4.10 per cent on Tuesday afternoon.
Several groups let the central bank know exactly where they stood ahead of the huge call, which had Aussies grappling with the cost-of-living crisis on tenterhooks.
A group of about 40 mortgage brokers have taken to the streets of the Sydney CBD on Tuesday afternoon to speak out against the longstanding stalemate on a rate cut and stand in solidarity with mortgage holders and aspiring homeowners.
The crowd of brokers, all from Aussie Home Loans, were carrying placards with messages including, ‘We’re hoping for one too’ and ‘Your interest is our interest’ as they marched towards Chifley Square, where the RBA was meeting.
Aussie Home Loans spokesman Brad Pogson said: “We’re gathering outside the RBA today in solidarity with the millions of Aussies who are desperately looking for rate relief after more than four years since the last rate cut.”
“Irrespective of what happens today, we’re encouraging all Australians to get professional advice.”
Speaking at the march ahead of the RBA’s decision, mortgage broker Samantha Harvey said the rate cut would be “well-deserved”.
“We’ve done the hard work and got inflation down, so it’s our time to reap the benefits,” she said.
Hurstville franchisee Alya Manji agreed a cut would be “really important” and a “well-earned relief” for Australian families.
The Australian Council of Trade Unions (ACTU) also held a short rally outside the building earlier in the day, after slamming the RBA in December as “out of touch and out of step”.
Speaking on Tuesday morning, ACTU secretary Sally McManus called out the RBA’s stance that wages were not putting pressure on inflation.
“There’s this idea that unemployment has to be at a certain level higher than it is at the moment in order to keep wages low, but that’s just crap – it’s not correct,” she said.
“They’ve got no excuse – no excuse whatsoever to not cut interest rates.
“Working people have had real wage increases, which has been good, but when your rents have gone up and your mortgages have gone up, obviously that’s had a huge impact and it’s meant that people have been under a lot of pressure.”
Shop, Distributive and Allied Employees Association (SDA) delegate Chris McKenzie said a rate cut on Tuesday afternoon would “reinvigorate retail spending”.
“(A rate cut) would give our members extra hours … it would give them a much better shot at paying all their bills and coping in a less stressed fashion,” he said.
Ms McManus had previously called on the RBA to follow the rest of the world’s example and start cutting rates, saying it was a “serious mistake” keeping them “too high for too long”.
“They were wrong on wages – there was no wage spiral. They were blind to price gouging when it was obvious to everyone. And their outdated idea that unemployment needs to go up is also wrong.”
Amid the rising pressure on the Reserve Bank, a leading economist earlier agreed Australia should get an outsized rate cut after doing the right thing and curbing inflation.
Anthony Albanese declined to add his opinion before the RBA’s decision on Tuesday, saying the bank would make a call based on the economics and not politics.
“We respect the independent decision that they will make,” the Prime Minister said.
“What our job has been to do is to get inflation down, we’ve done that. It had a six in front of it when we came to office, it’s now down to a headline rate of 2.4 per cent.”
Tuesday’s rate cut was the first for mortgage holders since the depths of the Covid pandemic.
Betashares chief economist David Bassanese said the RBA should cut beyond the market’s expectations.
“In fact, I’d like to see the RBA cut rates by 0.35 per cent to 4.0 per cent so we can finally get the cash rate cut back to cleaner 0.25 per cent level increments,” he said.
Mr Bassanese told NewsWire there should be an oversized cut to effectively reward Australians for good behaviour when it came to helping deal with inflation.
In return for this, households could receive less frequent cuts going forward, with the central bank instead following quarterly data out of the Australian Bureau of Statistics, Mr Bassanese said.
“The RBA could follow up this generous rate cut by playing down the prospect of another cut anytime soon,” he said.
Mr Bassanese said a rate cut was unlikely to spur on inflation spikes even in the much-feared housing sector due to cost-of-living issues.
“The problem with the housing sector is rents and house prices are so stretched they can’t really go much more on affordability grounds, so I don’t think we will get much rebound,” he said.
“Immigration is certainly strong but has slowed and wages growth at the current level of unemployment has slowed.”
Mr Bassanese said there were risks to the market if the RBA held rates, as consumers and businesses had been waiting for the better part of six months for rates to fall.
The RBA has held rates steady since November 2023 and has not cut rates since November 2020 in the peak of the Covid pandemic when rates were reduced to emergency levels.
Originally published as Surprise scenes as protesters march on RBA before interest rate cut
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