Let’s have a little look at the interest
rate issue. During the 2004 election campaign, Mr
Howard said: “I will guarantee that interest rates will always be lower under a
Coalition Government. Who do you trust to keep interest rates
low?”

If interest rates rise tomorrow morning and
the banks pass on the increase to mortgage holders, it will be seven straight
interest rate rises since May 2002 and three rises since the October 2004
election.

For someone taking out an average mortgage,
these interest increases mean an extra $650 per month or $7,825 per year on
interest payments alone. Have a look at this table. It shows how mortgage rates
have moved since April 2002 and the monthly “interest only” payments on that
loan.

Date Change in
interest rates
Interest
payments
on average mortgage*
April 2002 (Rates on hold) $794.88
8 May 2002 Up ¼ per cent $827.38
5 June 2002 Up ¼ per cent $863.93
5 November 2003 Up ¼ per cent $1,076.94
3 December 2003 Up ¼ per cent $1,100.07
2 March 2005 Up ¼ per cent $1,296.49
3 May 2006 Up ¼ per cent $1,400.64
2 August 2006 Up ¼ per cent $1,447.02

*Interest
only. Source: Reserve Bank of Australia,
Australian Bureau of Statistics

What’s more, Australian interest rates are
now higher than in:

  • The United States

  • Europe
  • Britain
  • Canada
  • Sweden
  • Switzerland
  • Japan
  • China
  • Malaysia
  • Singapore
  • South Korea
  • Taiwan
  • Thailand
  • Chile
  • Peru
  • Israel
  • Saudi Arabia
  • The Czech Republic
  • Poland

To name a few.

Get Crikey for $1 a week.

Lockdowns are over and BBQs are back! At last, we get to talk to people in real life. But conversation topics outside COVID are so thin on the ground.

Join Crikey and we’ll give you something to talk about. Get your first 12 weeks for $12 to get stories, analysis and BBQ stoppers you won’t see anywhere else.

Peter Fray
Peter Fray
Editor-in-chief of Crikey
12 weeks for just $12.