Rba Assistant chairman Kent said today that the impact of past interest rate hikes is now beginning to be felt. The Reserve Bank of Australia has kept interest rates at a decade-high of 4.1 percent for the past four months, waiting to see if the cumulative 400 basis points of tightening will be enough to tame inflation. Kent noted that households' mortgage payments are already at record highs and are set to rise further as older fixed-rate loans mature. Higher interest rates also increase the incentive for households to save rather than spend. Kent said: "The lag in transmission means that the further effects of interest rate increases to date will push inflation down further. Further monetary policy tightening may be needed to ensure that inflation, which remains too high, returns to target within a reasonable time frame."