Home loan gloom looms

NOW is the time to examine your home loan in light of higher interest rates, finance experts say.

Borrowers may face a hike next month after a Reserve Bank statement this week warned the chances of higher interest rates in the months ahead had increased.

Finance experts say higher interest rates will be a response to the Reserve Bank's commitment to keeping the lid on inflation.

The latest inflation rate of 2.6 per cent is within the central bank's comfort zone of 2 to 3 per cent. But the Reserve Bank is predicting 3 per cent or higher by the end of next year as capacity constraints push up wages and prices.

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