Laden with ‘world-beating’ debt, Australian households are at increased risk as rates rise, expert says

University of New South Wales researcher Chris Martin says ‘the intense concern about interest rates reflects Australia’s world-beating levels of household debts’. Photograph: jax10289/Getty Images/iStockphoto

Australian households are among the most indebted in the world and the start of interest rate increases by the Reserve Bank will generate “a big potential problem” for many people and the wider economy, a University of New South Wales researcher predicts.

Chris Martin, a senior research fellow in UNSW’s City Futures Research Centre, said data from the Bank of International Settlements showed total credit to Australian households amounts to about 120% of annual GDP.