There’s more mortgage pain on the way, economists are warning, with new forecasts suggesting the official cash rate could hit 3.85 per cent in 2023.

Interest rates have risen by a quarter of a per cent to 2.85 per cent, their highest level in nine years.

But the Reserve Bank has hinted at further increases in the months ahead, in a bid to curve rising inflation.

RateCity’s research director Sally Tindall said while yesterday’s rate hike was expected, it’s not the end for home owners.

“There was an outside chance of a double hike, I guess borrowers escaped that,” she told Laurel, Gary and Mark.

“But [RBA Governor Phillip Lowe] made a speech last night, he said there is more rate pain to come.

“He said you can’t rule out the RBA reverting back to double hikes at some point if inflation continues to get out of hand.”

She said Westpac, ANZ economists are predicting the cash rate will hit 3.85 per cent mid next year.

“That’s a full per cent higher than where we are, by the second half of next year.

“There are more hikes to come, I think borrowers really need to prepare for at least another full per cent more.”

Press PLAY to hear her analysis in full