The trade association for the Australian banking industry — Australian Banking Association (ABA) — launched a cost of living inquiry to closely study the impact of the COVID-19 pandemic, global supply chain constraints and geopolitical tensions, among others, on Australians.
An analysis of the rising inflation and concurrent collapse of three major traditional banks — Silicon Valley Bank (SVB), Silvergate Bank and Signature Bank — recently proved that more than 186 banks in the US are at risk of a similar shutdown if depositors decide to withdraw all funds. ABA’s inquiry aims to identify ways to ease the cost of living in Australia and the Government’s fiscal policy response.
Consumer price index, percentage change from corresponding quarter in previous year, December 2012 – December 2022. Source: ausbanking.org.au
ABA acknowledged that many Australians would struggle to adjust to a higher cost of living, while it may be easier for some, adding that:
“The ABA notes most customers will manage the higher cost of living and their mortgage commitments by changing their spending patterns, applying their accumulated savings to their higher repayments in anticipation of higher borrowing rates, or refinancing their mortgage.”
One of the biggest pressures for banks was when citizens rolled over from a fixed-rate mortgage to a variable rate. However, ABA urged customers to be proactive and ensure they are getting the best deal for their banking services.
Household savings ratio, December 2014 – December 2022. Source: ausbanking.org.au
Property rent across Australia has also witnessed a steady increase as markets normalized following the end of COVID-19 restrictions. Citizens experiencing financial difficulty can contact their banks and get help, including fees and charges waivers, emergency credit limit increases and deferral of scheduled loan repayments, to name a few.
Related: National Australia Bank makes first-ever cross-border stablecoin transaction
Alongside this attempt to cushion Australians against rising fiat inflation, the Reserve Bank of Australia and Treasury have been holding private meetings with executives from Coinbase, with discussions revolving around the future of crypto regulation in Australia.
Consultation open! Today we released the token mapping consultation paper. This consultation is part of a multi step reform agenda to develop an appropriate regulatory setting for the #crypto sector. Read paper & submit views @ https://t.co/4W2msjhP9B @ASIC_Connect @AUSTRAC pic.twitter.com/OGHuZEGvDp
— Australian Treasury (@Treasury_AU) February 2, 2023
Cointelegraph confirmed from an RBA spokesperson that Coinbase met with the RBA’s Payments Policy and Financial Stability departments in mid-March “as part of the Bank’s ongoing liaison with industry.”
