Today’s riddle: A woman is sitting in her hotel room and hears a knock at the door. She opens the door to see a man who she’s never met before. He says, “I’m sorry, I’ve made a mistake, I thought this was my room.” He then leaves. The woman goes back into her room and calls security. What made the woman so suspicious of the man?

This riddle stumped the office yesterday. Apparently my clue – “think about it” – was not helpful.

The quote
"The prime minister agrees with Ben Stokes. He said he simply wouldn't want to win a game in the manner Australia did." – A spokesperson for UK Prime Minister Rishi Sunak after Australia’s controversial Ashes win. If you need more context for what’s happened (you’re not alone🙋‍♀️), you can watch this explainer video we did yesterday.

The stat
17.01 degrees Celsius
The world’s average temperature on Monday, marking the hottest day ever recorded globally.

Today in history
1946: A daring two-piece swimsuit, the bikini, was unveiled for the first time at a Paris swimming pool by French designer Louis Réard.

Some headlines from this morning:

A ketamine haul weighing 84 kilograms and worth about $3.36 million has been seized by the Australian Federal Police. It's the biggest-ever seizure of ketamine in Australia.

Two men in their late twenties have been arrested. The men are believed to be linked to an international crime syndicate.

The sting:
Australian Border Force officers allegedly discovered the ketamine in May, inside the panels of two new vans that had been shipped to Melbourne.

The AFP seized the substance in 79 plastic bags and replaced them with a harmless substance. Police monitored as the vans were then delivered to their intended destination, a Sydney car dealership.

On Saturday, police say they followed one of the vehicles allegedly carrying the substituted substance, before conducting searches and making two arrests.

The two people were charged with attempted possession of a commercial quantity of ketamine, which could result in life imprisonment.

If you want your friends to wake up with us too, forward this email to them.

Was this newsletter forwarded to you? Sign up here (it’s free!)

The Reserve Bank of Australia has kept the cash rate at 4.1%. It comes after two consecutive months of rate rises.

RBA Governor Philip Lowe said inflation has now "passed its peak", but warned more rate rises may be required in future months.

The context:
The RBA began to increase its cash rate in May of last year. The cash rate is what the RBA charges commercial banks for short-term loans and it flows through to other interest rates across the economy (so it's often referred to as 'increasing interest rates').

The RBA is doing this to combat inflation (rising prices). Prices grew 5.6% from May 2022 to May 2023, well above the RBA's desired inflation rate of 2-3%.

Why raise rates?
The RBA's rationale is that higher interest rates make it more expensive to borrow, discouraging spending.

For example, a homeowner with higher monthly mortgage repayments might have to cut back spending elsewhere. Similarly, a business owner considering applying for a loan to expand their business might reconsider with a higher interest rate.

When there is less spending, there is less upward pressure on prices.

When is it enough?
It can be difficult for the RBA to know when it has done 'enough' to cut inflation because it takes a while for the full effects of a higher rate to be felt.

For example, some homeowners have 'fixed rate' mortgages, where the rate they pay is frozen for months at a time.

These homeowners will only experience the effects of higher interest rates when their fixed term ends.

Is it working?
There are some signs inflation is starting to be contained. The most recent figure of 5.6% is below the peak of 7.3% reached at the end of 2022.

However, there are signs spending is still strong.

While many people have felt a squeeze on their budgets, others with more financial means have continued to spend at high levels.

Will jobs be lost?
One risk associated with rising interest rates is that people lose their jobs.

The RBA says it hopes it can control inflation without job losses, but has warned some job losses may be unavoidable.

So far, there has not been much change. The unemployment rate is at 3.5%, the lowest level in 50 years.

Get all the news you need to know today in your ears on The Daily Aus podcast!

A record number of women in NSW underwent breast cancer screenings in May.

Over 37,000 mammograms were completed during the month. Breast screenings are a key part of early detection measures that can improve cancer survival rates.

At the moment, we’re all keen to save some cash where we can. However, it’s tricky to cut costs on those unavoidable expenses, like groceries, electricity, phone bills, and insurance. That's where Cashrewards comes in.

With Cashrewards, you can actually earn cash back on your regular, essential purchases. Get up to 20% cash back on utilities, groceries, and more when you shop with Cashrewards during their Ease The Squeeze campaign starting tomorrow. It's a great way to save while buying the things you actually need!

Sign up today with the code TDA and receive a $20 bonus cash back on your first shop today! T&Cs apply.

I have a recommendation!

This article, written by Sally Jenkins for The Washington Post, is an exploration of the long and complex friendship between tennis rivals Chris Evert and Martina Navratilova.

It documents their relationship from on-court rivals, to friends, to supporting one another through cancer diagnoses. I found it so fascinating to consider how isolating the experience of professional sport can be, and how in some ways it can bring you close to your rival – the only person who truly understands the feeling.

It’s definitely a long read, but a goodie!

* *
*
*
*
Answer: If he really thought it was his hotel room, he would have tried to open the door — not knock on it first.