UPDATE: Tensions rise as Nat Barr confronts Treasurer Jim Chalmers over his justifications for soaring inflation just hours before the Reserve Bank of Australia (RBA) is expected to announce an interest rate hike on February 2, 2026. With economists warning that homeowners could face an additional $1,300 in repayments this year, Barr’s pointed questions highlight growing public frustration.
During a fiery segment on *Sunrise*, Barr challenged Chalmers about the government’s fiscal policies and their impact on inflation. As the RBA gets ready to meet at 2:30 PM AEDT, analysts predict a significant increase in the cash rate target from 3.6% to 3.85%. This potential hike would position Australia as the only major economy tightening monetary policy to manage inflation, raising alarms among mortgage holders.
Matt Shirvington, another *Sunrise* host, criticized Chalmers for his earlier assertions that the “worst of the inflation challenge is well and truly behind us.” He asked, “Is it a bit irresponsible to say that now?” Chalmers defended his statement, claiming that inflation peaked at 7.8% in 2022, but acknowledged current pressures with rates now hovering in the threes.
“People are making decisions based on your statements,” Shirvington said. Barr interjected, “But Jim, the rest of the world’s had holidays too. We now have the highest inflation in the developed world, don’t we? What are you doing wrong?” Chalmers responded, emphasizing Australia’s lower unemployment and stronger economic growth compared to other nations.
The RBA’s decision today could lead to an increase in monthly repayments for homeowners with an average new loan of $694,000, rising by $109 to $4,025. This change will add further strain on families already grappling with high living costs.
As experts from Macquarie University and major financial institutions foresee additional rate hikes throughout the year, the urgency of the situation cannot be overstated. The RBA Governor Michele Bullock is set to reveal the bank’s strategy, leaving many anxious about the economic implications.
With pressure mounting on the government and the RBA, Australians are eagerly awaiting the outcome of today’s meeting. The conversation around inflation and government spending is far from over, making this a pivotal moment for the nation’s economic policy.
Stay tuned for more updates as this story develops.
