The Reserve Bank has today lifted the Official Cash Rate by 50 basis points to 5.25 per cent.
This is the 11th successive increase, and economists are concerned that this higher-than-expected hike will tip the country into recession.
Milford Asset Management portfolio manager Katlyn Parker says short-term interest rates were driven up and currency was stronger off the back of the unexpectedly high increase.
"You would have to question whether this will persist in the coming days, given the size of the hike we received today. That does increase the probability of a hard landing and a more severe recession."
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