Aussies unimpressed by interest rate hikes

Aussies appear to be increasingly concerned about their monetary situation, as financial confidence levels have dropped rather sharply.

The latest Westpac and Melbourne Institute survey has shown that the number of people who are happy with their current spending power fell by five per cent at the start of March.

Indeed, the index dipped to 96.1 – which is the lowest it has been since December 2011.

It seems that interest rates are the major talking point at the moment and the fact that the nation's major banks have all hiked their home loan rates in recent months has not gone down well with the Aussie on the street.

Despite sanctioning two cuts of 0.25 points towards the end of 2011, the Reserve Bank of Australia opted not to reduce interest rates any further in February and March and this appears to have had a major bearing on the confidence levels of concerned Aussies.

"Sensitivity to interest rates has clearly been one factor responsible for this weak print," commented Westpac's chief economist Bill Evans.

Have a question about interest rates? Ask the money gurus at Mozo Answers.