“This is bad news for the coalition in an election,” he said.
Uhlmann said the only other time interest rates had risen during an election campaign was in 2007, when incumbent Prime Minister John Howard lost to Labour’s Kevin Rudd.
“John Howard always promised that interest rates would be lower under the government he led,” Uhlmann said.
“But at this point we were going from 6.5% to 6.75%.
“It’s a very different interest rate story from then and now.”
An average homeowner with $500,000 in debt and 25 years remaining on their mortgage will now see their repayments increase by $39.
Three million Australians have mortgages, so today’s decision by the RBA has far-reaching financial consequences.
With the election just weeks away, there could be political ramifications, with the prime minister today distancing himself from the RBA’s decision.
Uhlmann said today’s rise is a “recipe for inflation.”
“When you have a near-zero cash rate, you have almost complete unemployment, that is going to fuel the prices you see.
“We’re getting out of emergency levels.”
Uhlmann said the Prime Minister would be even more concerned about the price of a mortgage.
“Is he being punished for this?”
“Do people hold him responsible for things that are really beyond his control?
“Certainly the Labor Party holds him responsible.”