Westpac reports $6.8 billion profit amid inflation concerns

Westpac has reported a flat annual profit of $6.8 billion, reflecting ongoing challenges in the Australian economy, particularly in the housing market. Chief Executive Anthony Miller indicated that the Reserve Bank of Australia (RBA) is likely to continue its efforts to combat inflation, which has prompted four interest rate increases this year, with more expected.

The bank's cash profit, excluding one-off items, stood at $7 billion, and it declared a full-year dividend of $1.54 per share. This announcement comes just ahead of an anticipated rise in the cash rate to 4.85 percent, which could significantly increase annual mortgage payments for households.

RBA Governor Michele Bullock has stated that the board will raise interest rates if necessary to reduce inflation, which currently sits at 4.3 percent, well above the target range of 2 to 3 percent. Prime Minister Anthony Albanese and New South Wales Premier Chris Minns have expressed concerns about the potential negative effects of further rate hikes on jobs and businesses, with Minns warning that such decisions could lead to permanent job losses and business closures.

Miller acknowledged the impact of recent rate increases and tax changes on the property market but remained optimistic about the overall performance of the Australian economy, citing strong business investment as a positive sign. He emphasized that demand for housing continues to exceed supply, despite the current downturn in the market.