Premier Minns warns of risk of job losses — The Guardian

New South Wales Premier Chris Minns has warned that a possible further interest rate hike by the Reserve Bank of Australia could lead to job losses and business closures. He also said the federal government and the states must restrain spending to ease pressure on the economy.

As The Guardian reports, markets expect a fifth rate increase in 2026. If it rises to 4.85%, it will be the highest level in 18 years. The Reserve Bank of Australia's decision on the cash rate is expected on Tuesday.

Call to restrain spending

Minns called the regulator's possible decision difficult and stressed that its consequences for the New South Wales economy would be significant. Responding to a question about the impact of public spending on inflation, he said everyone must do their part.

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Australian Prime Minister Anthony Albanese and Treasurer Jim Chalmers confirmed that the next mid-year budget update would contain a savings package. At the same time, the government points to international factors, including the war in Iran, as a reason for rising prices.

Reactions from politicians and trade unions

Environment Minister Murray Watt defended public spending, saying inflationary pressure is global in nature and would not disappear even if Australia's budget were zero. Labor Party representative Tanya Plibersek said the planned savings would be noticeable but would not harm households.

Australian Council of Trade Unions Secretary Sally McManus said at a rally outside the Reserve Bank's headquarters in Sydney that workers would not withstand another rate hike. Australian Council of Social Service chief executive Cassandra Goldie urged the regulator not to raise the rate and to take measures to reduce the cost of housing, energy and medical services that people pay for themselves.