Former Sunrise host David Koch has blamed a looming interest rate rise on government spending.
Koch, now the economic director of Compare the Market, publicly addressed Reserve Bank of Australia governor Michele Bullock in an open letter that peeled back layers of recent inflation to reveal the source.
A fourth rate rise for 2026 is expected after an RBA meeting next Tuesday, but Koch says it won’t fix the problem.
“I’m writing to you publicly because millions of Australians are crying out right now,” he told the RBA in his open letter.
Koch addressed recent spending on oil, but warned the RBA it makes up “only part of the story”.
In contrast to the cost-of-living impact on household spending, Koch highlighted that federal government spending has climbed to 26.8 per cent of GDP, much of it in categories such as childcare, education, healthcare, utilities and insurance.
Koch wants the RBA to call a spade a spade and “say it out loud” when interest rates dig deeper into household purses.
Monthly mortgage repayments have grown by $351 for those with an average loan of $735,000, since the start of the latest rate hike cycle, according to Compare the Market data, and Aussies have already absorbed three rate rises this year.
Rate rises mainly affect these mortgage holders, along with variable-rate small businesses, but they do not reach the state government infrastructure pipeline, Koch said.
Koch ackowledged the RBA is holding a bad hand, but urged Bullock to encourage a fair game nonetheless.