The RBA can't increase rates as this will fuel our already precedented Housing Bubble.
The ball is in the governments court to bring in Macroprudent controls, remove negative gearing and abolish the 50% capital gains discount. Maybe even regulate real estate agents saying house prices double every 7 years and that it is never a better time to buy.
Then once the heat is taken out of household housing sector, the RBA can resume the lowing of interest rates to bring down our dollar and help manufacturing.
