Crushing triple whammy could be coming for Australians as perfect storm brews

Australians could soon face a devastating triple blow to their bank accounts, with a perfect storm of a potential rate hike, hotter inflation and surging petrol prices brewing.

The country’s unemployment rate held steady at 4.4 per cent after 76,000 jobs were added in June and, while the figure is positive news for the labour market, it could spell doom for mortgage holders.

The chance of the Reserve Bank of Australia (RBA) hiking the cash rate at its next meeting in August jumped from 20 to 35 per cent as a result of the unemployment data, according to financial markets.

“The Reserve Bank meet later in August and we expect another 0.25 per cent rate hike, which would take the cash rate to 4.6 per cent,” AMP’s deputy chief economist Diana Mousina said.

“[The] strong labour force data gives the RBA room to hike rates again, because there will be less concern that another interest rate increase will hurt the economy.”

Meanwhile, CBA economist Trent Saunders forecasts a rate hold in August, an expectation largely shared by economists.

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Saunders said the unemployment data is “unlikely to materially change the RBA’s near-term outlook”.

“However, next week’s CPI will be an important release ahead of the August meeting,” he added.

The cash rate remained on hold at the last meeting in June, following three straight hikes to start the year.

While Westpac is forecasting a rates increase of 25 basis points in August, NAB, CBA and ANZ expect the RBA to hold again.

Headline inflation sits at 4.0 per cent, well above the RBA’s 2-3 per cent target range.

The RBA’s pending decision may come with a second and third financial blow to Australians in the coming months.

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Global oil prices have climbed back above $US100 (approx $143) per barrel, following attacks by Yemen’s Houthi rebels on two Saudi oil tankers in the Red Sea.

The news sent a shockwave through oil markets, and marked the first time that maritime warfare had spilled out of the Strait of Hormuz since the conflict in the Middle East began.

The Bab el-Mandeb strait had been used as an alternative to Hormuz.

Oil prices have now risen by about 35 per cent since the beginning of June.

Higher barrel prices risk inflation being pushed higher.

Hotter-than-expected inflation figures, released on Wednesday, could force the RBA to hike rates in August.

And this latest conflict escalation could deliver a wave of price surges for petrol and diesel in Australia, compounded by the expiry of the federal fuel excise in early August.

Extended cuts to the fuel excise duty rate of 16 cents per litre will end on August 2.

The fuel excise had been halved as a relief measure for Australian drivers in response to fuel price increases following the US-led attack on Iran.