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A road trip to Mexico for cosmetic surgery ended with two US citizens dead -- and two others found alive in a rural area near the Gulf coast -- after a violent shootout and abduction that was captured on video.

The surviving Americans were back on US soil after being sped to the border near Brownsville, the southernmost tip of Texas, in a convoy of ambulances and SUVs escorted by Mexican military Humvees and National Guard trucks with mounted machine guns.

A relative of one of the victims said on Monday that the four had travelled together from the Carolinas so one of them could get tummy tuck surgery from a doctor in the Mexican border city of Matamoros, where the abduction took place.

Tamaulipas GovernorAmerico Villarreal said the four were found in a wooden shack, where they were being guarded by a man who was arrested. Villarreal said the captive Americans had been moved around by their captors, and at one point were taken to a medical clinic "to create confusion and avoid efforts to rescue them."

The two dead will be turned over to US authorities following forensic work at the Matamoros morgue in the coming hours, the governor said.

Villareal said one of the survivors, Eric Williams, had been shot in the left leg and the wound was not life threatening.

Shortly after entering Mexico on Friday, the four were caught amid fighting between rival cartel groups in the city.

Tamaulipas state chief prosecutor Irving Barrios said the hypothesis is "that it was confusion, not a direct attack."

Video and photographs taken during and immediately after the abduction show the Americans' white minivan sitting beside another vehicle, with at least one bullet hole in the driver's side window. A witness said the two vehicles had collided. Almost immediately, several men in tactical vests and toting assault rifles arrived in another vehicle to surround the scene.

The gunmen walked one of the Americans into the bed of a white pickup, then dragged and loaded the three others. Terrified civilian motorists sat silently in their cars, hoping not to draw their attention. Two of the victims appeared to be motionless.

Officials said a Mexican woman a block and a half away from the scene died in Friday's crossfire.

The shootings illustrate the terror that has prevailed for years in Matamoros, a city dominated by factions of the powerful Gulf drug cartel who often fight among themselves. Amid the violence, thousands of Mexicans have disappeared in Tamaulipas state alone.

Mexican President Andres Manuel Lopez Obrador said the people responsible would be punished. He referenced arrests made in the 2019 killings of nine US-Mexican dual citizens in Sonora near the US border.

He complained about the US media's coverage of the missing Americans, accusing them of sensationalism. "It's not like that when they kill Mexicans in the United States, they (the media) go quiet like mummies."

US Attorney General Merrick Garland, said "The cartels are responsible for the deaths of Americans.The DEA and the FBI are doing everything possible to dismantle and disrupt and ultimately prosecute the leaders of the cartels and the entire networks that they depend on."

The FBI had offered a $50,000 reward for the victims' return and the arrest of the abductors.

© RAW 2023

The 10th consecutive interest rate rise in a row will further tighten the screws on household budgets, according to the treasurer.

Ahead of a closely watched speech by Reserve Bank governor Philip Lowe on possible further hikes, Dr Jim Chalmers said the increase had put further pressure on families.

The Reserve Bank on Tuesday raised the official cash rate by 25 basis points to 3.6 per cent, the highest level since 2012.

"Yesterday's decision will really tighten the screws on household budgets, I think that's very clear. A lot of people are doing it very tough and it will make life a bit harder," Dr Chalmers told ABC Radio on Wednesday.

"When people are under extreme financial pressure, that has implications for their wellbeing more broadly.

The RBA governor will deliver a speech to a business conference later on Wednesday on inflation and economic data, which is set to be closely scrutinised for further insights into interest rate plans.

While the treasurer said there were encouraging signs inflation had peaked, it remained to be seen whether it was the case.

"Inflation will moderate over the course of the next 12 to 18 months, we would like it to moderate quicker, as quickly as possible," he said.

"Obviously I'm concerned about the position that Australians find themselves, particularly Australians with a mortgage."

Deputy Liberal leader Sussan Ley urged the government to bring spending under control in order to lessen the impact of inflation.

"It's simple economics, if the government doesn't get fiscal policy right, that makes inflation go up, that makes inflation higher than they need to," she told ABC Radio on Wednesday.

"The Reserve Bank is doing its job, the government is not ... this means an extra $20,000 a year that a typical Australian family will now have to find on their mortgage, this is incredibly difficult for families right now."

The treasurer said there was a need to show restraint in the budget.

"We will do that in every budget. We will look for areas where we can trim spending," he said.

"Restraint's important, but in addition to the magnitude of the spending, which does matter in times like these, also the quality of the spending matters."

RateCity analysis shows the average owner-occupier with a $500,000 loan and 25 years remaining will see their monthly repayments rise by another $77 if banks pass the rate hike on in full.

The average borrower's monthly repayments are up nearly $1000 since April 2022, when the rate rises began.

RateCity research director Sally Tindall said mortgage rates starting with a "four" were likely to disappear after this rate rise.

"After this latest hike washes through, a small handful of lenders are likely to hold on to rates just under five per cent, but we're likely to be able to count these loans on two hands," she said.

Ms Tindall urged mortgage holders to refinance to secure a better deal.

© AAP 2023

A speech by the Reserve Bank governor will be scrutinised for any insights into plans for further interest rate hikes as borrowers feel the pain of 10 consecutive increases.

RBA Governor Philip Lowe will deliver a speech about inflation and recent economic data at a speech to a business conference on Wednesday.

The speech will likely touch on the softer-than-expected labour market, wage and economic growth data released in the past few weeks, as well as the trajectory for inflation now that it's likely past its peak.

The speech at the Australian Financial Review Business Summit in Sydney follows the Reserve Bank delivering the 10th interest rate hike in a row on Tuesday afternoon.

The 25-basis-point hike brought the cash rate to 3.6 per cent, the highest level in more than a decade.

Treasurer Jim Chalmers said the government was pulling the levers available to it - "a combination of relief, repair and restraint" - to help the RBA with its difficult job of taming inflation.

He told the summit on Tuesday night that higher interest rates were putting pressure on borrowers and businesses.

"Already, Australian households spent $20 billion on mortgage interest payments in the last quarter, compared to $11 billion in the same period the year before," he said.

Deputy Liberal leader Sussan Ley urged the government to bring spending under control in order to lessen the impact of inflation.

"It's simple economics, if the government doesn't get fiscal policy right, that makes inflation go up, that makes inflation higher than they need to," she told ABC Radio on Wednesday.

"The Reserve Bank is doing its job, the government is not ... this means an extra $20,000 a year that a typical Australian family will now have to find on their mortgage, this is incredibly difficult for families right now."

RateCity analysis shows the average owner-occupier with a $500,000 loan and 25 years remaining will see their monthly repayments rise by another $77 if banks pass the rate hike on in full.

The average borrower's monthly repayments are up nearly $1000 since April 2022, when the rate rises began.

RateCity research director Sally Tindall said mortgage rates starting with a "four" were likely to disappear after this rate rise.

"After this latest hike washes through, a small handful of lenders are likely to hold on to rates just under five per cent, but we're likely to be able to count these loans on two hands," she said.

Ms Tindall urged mortgage holders to refinance to secure a better deal.

© AAP 2023