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The Commonwealth Bank of Australia will increase mortgage interest rates by 0.5 percentage points, passing on the Reserve Bank’s latest official rate rise to customers in full.

The Reserve Bank of Australia increased the official cash rate by 0.5 percentage points on Tuesday, taking it to 1.35 per cent.

CBA raises mortgage interest rates by 0.5 per cent. Credit: Paul Jeffers

The RBA has now lifted the cash rate by 1.25 percentage points in three months. Economists expect the cash rate will continue to climb in the coming months, reaching around 2 per cent by the end of the year to tackle rising inflation.

On Wednesday morning, CBA was the first bank to announce changes to its interest rates. Standard variable home loan rates will increase by 0.5 per cent.

The deposit rate for several savings products - GoalSaver and Youthsaver - will also increase by 0.5 per cent. The changes will take place from July 15.

“These new deposit rate changes, combined with the increases we’ve made over the past two months, will help deliver better savings outcomes for our customers, however they are looking to save,” said retail banking group executive Angus Sullivan.

“We have a range of deposit products to suit our customers’ needs and encourage them to speak with us to ensure they are in the product that best suits them,” Sullivan said.

Sullivan said the changing rate environment could raise questions for customers and encouraged them to connect with a home lending specialist if they needed help.

Prime Minister Anthony Albanese said the federal government could not afford to continue to increase debt, despite interest rate increases impacting households and businesses.

“We know people are doing it really tough,” Albanese told reporters on Wednesday.

He said the interest rate rises had been foreshadowed before the election and further increases were also likely to occur this year.

The Reserve Bank of Australia rose official interest rates by 0.5 basis points to 1.35 per cent on Tuesday.

Albanese said “structural changes” such as cheaper childcare would assist households but the government could not provide other payments such as continuing the reduction in the fuel excise, which is set to expire at the end of September.

“The former government put in place a time-limited change … before the election both sides said they had no plans to increase that further into the future,” he said.

“In the long run if we don’t do something about improving the fiscal position of the budget then the impact on households will just flow on down the track. So we do have difficult decisions to make.

“Just as higher interest rates mean difficulties for households they also mean higher debt levels because that has an impact on that trillion dollars [in government debt].”

NSW Liberal MP Gabrielle Upton, the state’s first female attorney-general, has announced she will quit politics ahead of next year’s election.

The former environment minister and attorney-general released a statement on Wednesday morning confirming she would not recontest her seat of Vaucluse at the March 2023 election.

“I know in my heart that this is the right time to retire. It is the time for someone else to take my place and for me to do something new,” Upton said in a statement.

Upton was first elected to parliament in 2011 as the member for Vaucluse, a safe Liberal seat in Sydney’s eastern suburbs.

“As the state’s first female attorney general I am thankful to have led reforms to support child victims in child sexual assault proceedings and as environment minister to have introduced the Return and Earn container deposit litter reduction scheme,” she said.

At least 65 home owners have been left in financial limbo after another Victorian house builder collapsed, citing pressure from construction costs, supply chain delays and labour shortages.

Construction businesses around the country are under stress. Credit: Paul Jeffers

Family-owned Langford Jones Homes is in liquidation, owing 250 creditors more than $10 million. The builder had projects in Melbourne’s bayside and south-east suburbs and on Phillip Island.

Langford ceased trading last Thursday and appointed RSM Australia partners Jonathon Colbran and Richard Stone as liquidators. Customers with deposits for homes or properties already under construction have been contacted in recent days.

On Tuesday, Stone said all homeowners had been given access to their property and their keys returned. “They’re all at different stages of completion. There are a number of new homeowners who have paid deposits. They will have to go through the liquidation process and submit a claim,” he said.

Read the full story here.

NSW premier Dominic Perrottet says he was “disappointed” with the time it took for grants to be received during NSW’s last flood event but believes changes have since occurred.

“I was disappointed with the pace of the rollout of the grants particularly at the last event in relation to the Northern Rivers,” Perrottet said of the former federal government’s relief payments earlier this year. “Expectations were not met.”

He said changes were made more recently when the federal government was in caretaker mode.

“My view has always been that we should be erring on the side of getting money out the door and auditing later.”

Prime Minister Anthony Albanese says payments which will become available for people severely impacted by flooding have been approved quicker than previous relief.

“This is the quickest these payments have ever been approved, this is on top of the joint arrangements that have been made available through NSW and the Commonwealth,” he said.

Albanese said the government was also focused on long-term solutions, such as considering lifting levies and would have a range of measures to introduce when Parliament sits.

“The people of the Hawkesbury Richmond area have now had four flooding events in the last 18 months, prior to that they were impacted by bushfires,” he said.

“That’s why my government is acting, but I’ve got to say as well the New South Wales Government are acting as well, on changing the energy mix in the state.

“No state and no nation connect by itself.”

NSW Premier Dominic Perrottet said the flood emergency was “far from over” for many communities across Sydney as the weather event moved north through the Hunter, Central Coast and Mid North Coast.

“It’s been a particularly difficult night across the Hunter area,” Perrottet said.

Prime Minister Anthony Albanese and NSW Premier Dominic Perrottet receive a briefing at RFS headquarters. Credit: James Brickwood

He said additional resources were arriving from interstate on Wednesday to assist the SES.

Perrottet said river systems right across the state remained full, and cautioned that evacuation orders remained in place.

“Whilst it might be tempting for people to return home, we’re really asking you to respect those evacuation orders,” he said.

Damage assessments would commence on Wednesday as floodwaters receded through communities in Sydney.

“That will inform governments both state and national level going forward,” he said.

The federal government will make 150 more defence force personnel available to assist with flood recovery efforts from tomorrow.

Prime Minister Anthony Albanese said there would be 250 ADF personnel available from Thursday, with 100 personnel already playing a role.

“It’s expected that we’ll use the fact that there are facilities available and personnel available in synchronism,” Albanese said this morning.

A third helicopter will also be made available and will be used for nighttime operations, the prime minister said.

The defence support comes alongside payments of $1000 for adults and $400 for children that will become available at 2pm on Thursday.

Albanese thanked the ADF personnel for their work alongside volunteers.

“At the worst of times, we always see the best of Australia,” Albanese said.

Prime Minister Anthony Albanese has announced that the disaster recovery allowance for NSW flood victims will kick in from 2pm tomorrow.

The funding will also be directed to employees and sole traders for a maximum of 13 weeks and New Zealand-born victims.

NSW Premier Dominic Perrottet thanked the federal government for its assistance and praised the state’s volunteers for their efforts.

“The announcement today for those relief payments is very important, particularly for those families who have been impacted.”

Perrottet implored people to follow evacuation orders in their areas.

“If there is an evacuation order in place in your area, please get ready to evacuate. Please don’t drive through floodwaters ... it’s incredibly dangerous, the perspective you have is very different to the reality.

“Simply because you’ve had a flood event in the past it could be very different to the one today.”

There have been 6000 requests for assistance over the course of this flood event and 21 flood rescues overnight.

Prime Minister Anthony Albanese is giving a press conference with NSW Premier Dominic Perrottet in the state’s flood affected areas at 9.15am.