sydneyaustralias economy will be lucky to avoid a recession this year with rising interest rates set to crunch consumer spending and foster the weakest economic conditions in 30 years according to the latest deloitte access economics business outlook global economic growth is also set to slow to a trickle as the battle to contain inflation continues over a long horizon the reserve bank of australias decision to continue raising interest rates in february and march will result in a consumer recession this year with household spending expected to finish the year below where it started said stephen smith lead author of the report the rba raised its official cash rate to 360 in march its highest level in more than a decade and the 10th consecutive increase since may last year the recordbreaking blitz of rate increases targeted the biggest inflation spike since the early 1990s still recent monthly inflation data has pointed to a likely peak inflation late in late 2022 the rba announced a pause in its interestrate increases this month but warned that further hikes were possible if inflation remains stubbornly high the impact of the hikes announced so far will grow over the coming months however as borrowers with low fixedrate loans will be exposed to much higher floating rates by early 2024 the cost of servicing an average 600000 australian dollar us402480 mortgage will have risen by more than a14000 a year as higher interest rates hit household budgets mr smith said but thats just the average and there are plenty of mortgage holders on either side of those numbers he added the rba itself is estimating that around 15 of variablerate owneroccupier mortgage holders will be in negative cash flow by the end of 2023 with as many as 300000 borrowers already projected to be in this position deloitte access economics has revised down its expectations for australias economic growth in 2023 and 2024 to just 15 and 12 respectively