The country’s chief money regulator has revealed that nearly one in two Australians with debt are struggling with their repayments. And this is the news the Reserve Bank shouldn’t ignore when it meets on interest rates on June 18.

The Daily Telegraph has run a valuable story today counselling those under debt pressure that help is available. “As interest rates remain at 12-year highs, a study by the Australian Securities and Investments Commission (ASIC) found 5.8 million people have found it tough to repay debts, but many refused to seek help,” the Tele’s Anthony Keane tells us. “Three out of 10 people said they would not seek hardship assistance from a lender, while many said they would prefer to sell assets or get a second job to deal with their debts.”

These kinds of intended real life actions show that 13 rate rises are changing the lives of millions of borrowers, their dependent family members and, ultimately, the businesses that sell them goods and services.

While this is the small picture or individual effects of the RBA’s tightening of interest rate policy to beat down inflation, we get to see how those rate rises have affected the big picture on Wednesday.

That’s when we see the nation’s National Accounts — call them the country’s financial books if you like — which show us the annual economic growth number. If it shows more-than-expected growth, then that will be bad for interest rate sufferers, as it will be another reason, other than a slightly rising CPI or inflation, for the RBA to give us a 14^th rate hike!

In contrast, a weak number will present the possibility that we could be skirting close to the economic wind that could blow us into a recession.

Over the weekend, the AFR’s Michael Read gave us the results of a survey of economists that indicated the March economic growth rate will be a low 0.2% for the quarter, or 1.2% for the year. The previous annual reading was 1.5%, but if this quarterly number is worse than 0.2%, the RBA will find it difficult to entertain the idea of further rate rises and should be thinking about when rate cuts would be appropriate.

What you have to factor in is that what we see on Wednesday will be the growth figures for January to March, but we’re now two months into a new quarter that looks economically weaker than the start of the year.

NAB’s economists who monitor how rate rises have affected the economy, think the recent run of data suggests more rate rises would be a mistake. “For now, the weakness on the activity side is likely to see the RBA hold off on any further increases in the cash rate as it looks forward to the downstream impacts of slower growth and balances the risk of a faster deterioration in the labour market,” NAB’s economics team told the AFR. Come Wednesday, if the RBA sees a surprisingly weakening economy, it will be caught in a dilemma between worrying about sticky inflation that’s taking its time to fall into the 2%-3% band and the fear that anymore rate rises could throw us into recession.

For those under debt pressure, ASIC noted that there had been a 54% rise in home loan hardship notices in the final three months of 2023, but it also has found that many borrowers don’t know assistance is available if repayments are becoming challenging.

This comes as ASIC recently accused banks and other lenders of not doing the right thing by those who contacted them with repayment problems, and it has prompted the ASIC commissioner Alan Kirkland to give timely advice. “People also tell us that there are emotional barriers on top of those practical barriers [and]… these emotional barriers can hold people back from seeking assistance, but our message is that, if you don’t seek assistance, often you can end up in a financially worse situation.”

ASIC’s Moneysmart campaign urges people struggling financially to “just ask” and first contact their lender, which has legal obligations to help customers in trouble. And if they don’t help, report them to ASIC.