The highest interest rate hike in Reserve Bank history could signal collective belt tightening for many mortagages holders.
The Official Cash Rate rose 75 basis points to 4.25 percent. And that means homeowners who fixed their mortages at historically low rates will potentially be paying double the interest they are now.
The banks also forecasting inflation will hit 7.5 percent by Christmas. And a recession is expected by mid next year.
ANZ chief economist Sharon Zollner talks to Lisa Owen.
