Overview
- The Financial Stability Review warns prolonged energy supply disruptions could stoke inflation and sap global demand.
- Policymakers see heightened risk of disorderly asset repricing, with sovereign debt markets vulnerable after years of low risk premia and large deficits.
- Oil has jumped from roughly US$56 to above US$110 a barrel since late February as the Middle East war escalated.
- The RBA says Australian banks are well capitalised and most households have buffers, though pockets of borrowers face pressure and high‑LVR loans rose under the 5% deposit scheme, which carries government guarantees.
- After a narrow decision to lift the cash rate to 4.1%, markets are pricing a chance of further tightening, and the RBA also flags risks from AI investment reversals, cyber threats and China’s property‑led fragility.