The RBA held the official cash rate at 3.60%. 100% of Finder's economists and experts correctly predicted the decision.
The official cash rate is:
3.60%
The RBA's next interest rate decision is on:
04 November 2025
Of the experts surveyed by Finder for September:
100% correctly predicted a rate cut.
"Mixed economic signals have kept the RBA in a holding pattern. While spending remains strong, rising inflation and increasing unemployment add complexity to the decision-making process."
These graphs show movements in the official cash rate over time and changes to the market's lowest home loan rates over the same period. You can see how the market responds by raising or lowering rates broadly in line with the RBA's decisions.
How often are Finder's expert predictions correct?
The latest cash rate analysis from the experts
Finder regularly surveys 40+ economists and property experts to forecast the RBA's next cash rate decision and get insights into the future of the Australian economy. Here are the most recent cash rate predictions.
Not this time! No doubt the RBA is on a slide down with the cash rate. However, the several promised cuts will be spread over quite some time, and we should not expect a cut at every single meeting. I believe this was well understood since the beginning of this year. The more surprising was the media drama about the HOLD decision in July. My forecasts are firmly centred around the HOLD decision this month. I interpret this as the markets accepting the RBA's pace of interest rate cuts. My forecasts are available at: https://forecasting-cash-rate.github.io/
Although inflation has come down, the latest ABS data showed economic growth rebounded in the June quarter. As a result, I expect the Board will hold the cash rate at this month’s meeting. By the next RBA Board meeting in November, the September quarterly CPI will have been released. This will help provide more certainty around whether inflation is staying on track before the Board considers further cash rate cuts.
The RBA has definitively shifted its assessment of the balance of risks to the economy. However, it's also signalled a cautious approach to policy easing, suggesting it will wait for more data before cutting rates again.
Inflation is within the target band. While there is near-term weakening of the labour market, it has probably not yet progressed to the point of triggering an immediate cut
I expect the RBA to hold in September, the jobs market is still a bit tight and services inflation needs to keep easing. Recent cuts have lifted property market activity, demand is up while listings remain tight, keeping prices moving higher.
Although the RBA is in a cutting cycle, they are taking a gradual approach to make sure inflation stays in the target range. Also, domestic conditions look a bit stronger than previously thought. So they are likely to hold this time and maybe cut in one of the next two rounds.
With inflation ticking up it would seem the RBA's last rate cut was premature. It seems highly unlikely to me that the RBA would risk a further rate cut when the direction of inflation is upwards, fuelled by high levels of government spending and expensive power due to significantly high domestic and commercial power prices
Inflation is not yet under control, and the government's initiative to ease the conditions on the first home buyer mortgage insurance scheme is going to cause another surge in prices. We don't need to add increased rates to this heady mix.
The RBA will remain on hold on September awaiting further data on jobs and and inflation, but should continue the easing cycle in November maintaining the pace of quarterly cuts at a quarter of a percent.
We are forecasting the RBA to hold rates in September, with a further cut anticipated in November. Market sentiment remains cautious following the recent reduction in August.
The RBA has said it will adjust monetary policy gradually, reiterating this in the minutes of the most recent meeting and subsequent comments from the Governor. Data since the last meeting hasn't warranted diverting from that stance by cutting rates at consecutive meetings. I remain of the view they will cut by 25 bp in November.
Inflation has eased, but isn’t out of the woods as economic growth showing signs of strength GDP rose by ~0.6% in the June quarter, helped by stronger household spending. This suggests that the demand side is picking up, which could reignite inflationary pressures if interest rates are dropped too soon. The RBA tends not to react to temporary dips in inflation or volatile signals. They will wait for consistent data showing inflation is moving sustainably toward their target, rather than bouncing around.
The RBA is likely to hold since it seems to be waiting to see if CPI inflation for Q3 (due 29 October) remains in the target range. Monetary policy remains mildly restrictive, which I believe is not necessary, and so the cash rate should be cut to neutral immediately. There is significant uncertainty but the downside risks are greater than the upside ones.
Inflation is below the RBA's target range, and the labour market looks firm. The RBA believes that upcoming data releases will show that the economy is doing well enough not to need a cut a the September meeting, even if one is anticipated in November.
The RBA has indicated that it will take a gradual and measured approach to easing interest rates which implies quarterly cuts. Since the August meeting nothing has happened to change this. Underlying inflation is around target and economic growth is recovering gradually. So the RBA is likely to hold.
The RBA is playing a conservative game. They have flagged that the quarterly CPI inflation data is their trigger for rate cuts. This means, the next rate cut will have to wait until their November meeting.
While employment data released this month was weak, the Reserve Bank of Australia’s Monetary Board will want further evidence of a trend before adjusting the cash rate. Additionally, annual trimmed mean inflation data for August was marginally higher than expected, but still within the RBA’s preferred 2-3 percent band. The RBA meeting also comes amidst the backdrop of the spring selling season where more buyers have entered the real estate market. In the first three weeks of the peak buying season, Loan Market’s pre-approval figures were up 29.5% compared to the same time last year. Property listings are down year-on-year. Auction clearance rates have hit a high 70 percent mark in Sydney and Melbourne as more people compete for limited stock. The RBA will also hold-off on adjusting the cash rate because it will want to see the impact of the fast-tracked changes to the First Home Guarantee. Loan Market’s brokers have received an increase in enquiries from first home buyers since the Prime Minister announced the Scheme’s amendments were being brought forward to October 1. Increased price caps and the removal of income thresholds on the Scheme will create greater choice for first home buyers.
Considering the lagging effects of the cash rate, it is likely that the RBA will temporarily pause its current expansionary policy. While inflation remains relatively stable, it is still facing upward pressures from various global events such as geopolitical tensions, trade wars, supply chain disruptions, and volatile exchange rates. These events could lead to increased price pressures, channelled through rising import prices.
Recent indicators show that economic growth has picked up, especially in private spending, the labour market is relatively steady, while inflation is still at the higher end of the target range. A wait and see approach looks the most likely.
The weaker-than-expected employment figures might support the case for another rate cut however we expect the Reserve Bank’s preference will be to take more time to understand the full impact of the previous cuts before taking further action.
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The Reserve Bank of Australia sets the official cash rate target. This is a benchmark rate that has a big impact on home loan interest rates, savings accounts and other credit products.
What is the official cash rate?
One of the Reserve Bank's primary roles is setting monetary policy for the Australian economy. This involves setting the cash rate (or to use its full name, the official cash rate target).
At a technical level, the cash rate is actually the interest rate banks pay for borrowing money from each other overnight. Banks use this to manage liquidity and issue funds as needed.
Australian banks can borrow and deposit money with the RBA at just below the current cash rate target.
How the official cash rate target affects interest rates
But for the average Australian consumer, the cash rate is really useful as a broad benchmark for the interest rates on home loans and savings accounts. A high cash rate makes borrowing money more expensive and sees home loan repayments rise.
A low cash rate makes it cheaper to borrow money. This boosts borrowing and spending.
How has the cash rate changed over time?
The Reserve Bank adjusts the official cash rate target over time in response to various economic data, including:
Inflation
The unemployment rate
Global economic factors
The cash rate stayed at the then record low of 1.50% from 2016 to 2019, when the RBA lowered it further in response to low inflation and slightly higher unemployment.
Then as the Covid-19 pandemic began to hurt the Australian economy the RBA dropped the cash rate even further. This was to make borrowing cheaper and stimulate a struggling economy. The cash rate hit the record low of 0.10% during this time.
Now, with inflation soaring the RBA has lifted the cash rate very quickly to try to slow demand and curb price rises.
How does the RBA's cash rate decisions affect your finances?
The RBA can do 3 things with the cash rate: Raise, lower or hold the cash rate at its current level.
If the RBA lifts the cash rate
When the cash rate rises, most lenders pass on the rate rise to borrowers on variable rate home loans.
If the cash rate rises by 25 basis points, then most borrowers will see 25 basis points added to their home loan's interest rate.
If you have a fixed rate home loan nothing changes. Your rate is locked in for the duration of the fixed period.
When the RBA lowers the cash rate, most lenders pass on some if not all of the cut to borrowers on variable rate home loans.
Banks also lower rates on savings accounts and other products.
If you have a home loan, it's a good idea to check if your lender has actually passed on the rate cut to you. If it hasn't, you may need to switch.
If the RBA holds the cash rate
A hold decision means the cash rate isn't changing this month. This means that your home loan or savings account rate likely won't change. You don't really have to do anything.
But banks and lenders change interest rates all the time for various reasons even if the RBA doesn't move the cash rate.
Calculate how much a cash rate cut will impact your home loan repayments
Enter your loan amount, current interest rate and the latest cash rate change to quickly estimate how much your monthly repayments will change, and what your new repayment will be.
Example: how changes to the cash rate can change your loan repayments
You have a $600,000 home loan with a variable interest rate of 6.00%. It's a 30-year loan term with principal-and-interest repayments.
Your monthly repayments are $3,598.
⬆️ If the cash rate rises by 25 basis points your interest rate would increase to 6.25%. Your monthly repayments would now be $3,695. This would cost you an extra $97 a month or $1,164 a year.
⬇️ If the cash rate decreases by 25 basis points your interest rate would fall to 5.75%. Your monthly repayments would now be $3,502. This would save you $96 a month or $1,152 a year.
More questions about the RBA cash rate
Lenders are free to change interest rates on their products whenever they want. The cash rate is a big influence on rates, but there are many other factors. This includes a lender's own funding costs, the amount of deposits the lender has and how competitive it wants to be to attract new customers.
The RBA changes the cash rate target based on a range of factors including inflation, the performance of the Aussie dollar, unemployment, the housing market, and Australia's Gross Domestic Product (GDP).
For example, if inflation rises above the target rate it means that Australians are spending their money too freely and prices are increasing too rapidly. But if the RBA raises interest rates to make it more expensive to borrow money, the economy will settle and price increases will slow down.
Conversely, the RBA will drop interest rates if inflation is too low and the economy is stagnating, encouraging more Australians to spend more money and stimulate economic growth.
The Reserve Bank of Australia is the country's central bank. The RBA's monetary policy has three key objectives which are set out in the Reserve Bank Act 1959:
The stability of the currency of Australia.
The maintenance of full employment in Australia.
The economic prosperity and welfare of the people of Australia.
Setting the official cash rate is one of the bank's key tools to influence monetary policy, inflation and the broader Australian economy. The bank's board meets on the first Tuesday of every month except January to set the cash rate. The RBA will either cut, raise or hold the cash rate.
The RBA's board of governors meets 8 times a year, in February, March, May, June, August, September, November and December. It is here that the board makes a decision on the official cash rate target.
The board used to meet 11 times a year, on every first Tuesday of the month apart from January. It lessened the number of times it meets to provide more time for change between meetings.
However, the RBA can alter the cash rate at any time outside of the meetings. This is rare, but can happen. In March 2020, in response to the onset of the COVID pandemic, the bank cut the cash rate twice. Once at the scheduled meeting and then again mid-month at a special emergency meeting.
Check out more RBA news and Finder's RBA survey press releases
After the RBA cut interest rates for the third time this year, it's a great time for borrowers to assess their own rate. But finding a lower rate doesn't always mean you should switch.
Richard Whitten is Finder’s Senior Money Editor, with over eight years of experience in home loans, property, credit cards and personal finance. His insights appear in top media outlets like Yahoo Finance, Money Magazine, and the Herald Sun, and he frequently offers expert commentary on television and radio, helping Australians navigate mortgages and property ownership. Richard started his career in education and textbook publishing in South Korea. He holds multiple industry certifications, including a Certificate IV in Mortgage Broking (RG 206) and Tier 1 and Tier 2 certifications (RG 146), as well as a Bachelor of Education from the University of Sydney and a Graduate Certificate in Communications from Deakin University. See full bio
Richard's expertise
Richard has written 666 Finder guides across topics including:
At this stage it’s impossible to say. The outlook for the moment is for rates to either fall slightly further or stay where they are, over the next 6-12 months.
Beyond that we just don’t know. For rates to start rising we’d need to see a big increase in inflation at least.
CuteyJune 16, 2022
When the RBA decreases the cash rate , does it mean it prints more money to increase money supply and thereby decreasing the borrowing rate. And if that is the case, does increasing the cash rate mean that the RBA has to extinguish some of the money supply thereby reducing the money available to borrow. I am assuming that RBA can’t just simply say the cash rate is this much, it has to increase/decrease money supply at the backend to make sure the cash rate stays at whatever level it wants to stay at.
Finder
RichardJune 18, 2022Finder
Hi,
The cash rate determines the interest rate lenders can charge when lending money to each other at short notice (also called the overnight cash rate). Lenders and banks are always moving money around to cover different investments and expenses, including funding for home loans.
So the cash rate affects their costs, and they pass this onto borrowers. Changing the cash rate target does nothing to the amount of money in the economy. It affects the cost of borrowing and lending money.
The RBA does in effect create money sometimes, in a process called quantitative easing. This involves purchasing bonds from investors at a favourable rate, freeing up investor cash to go elsewhere in the economy. This is different to the cash rate.
I hope this helps.
Regards,
Richard
octoJune 18, 2018
how long can AUD interest rate remain Low…..?
how soon will the AUD follow the US FED Rate Hike…….?
thank you
NikkiJune 20, 2018
Hi Octo!
Thanks for getting in touch!
To know more information on your questions, you can fill in your email address in the box provided and you’ll be updated on RBA’s decisions on the official cash rate target.
While we provide you with general information, please know that we don’t stand as a representation for RBA or any company featured on our site.
Hope that clarifies!
Cheers,
Nikki
TaneeshaMay 24, 2018
Do you think the cash rate will stay the same at the June RBA meeting?
Finder
JoshuaMay 24, 2018Finder
Hi Taneesha,
Thanks for getting in touch with finder. I hope all is well for you. :)
Unfortunately, we are not in the best place to make a prediction. However, you might get an idea whether the RBA cash rate will rise or fall by looking at the factors that affect it. These factors may include:
I hope this helps. Should you have further questions, please don’t hesitate to reach us out again.
Have a wonderful day!
Cheers,
Joshua
BrookMay 5, 2018
What do you think that how the international economic condition influence the cash rate?
Finder
JeniMay 6, 2018Finder
Hi Brook,
Thank you for getting in touch with Finder.
This is a nice question. Domestic financial conditions remain expansionary. There has been some tightening in short-term
money markets, which has flowed through to a small increase in funding costs for a range of financial institutions and businesses. However, borrowing rates remain low for households and businesses. Growth in housing credit has eased since mid last year, particularly for credit extended to investors, while growth in business debt has remained moderate. The Australian dollar remains within its narrow range of the past two years. Financial market prices suggest that the cash rate is expected to remain unchanged this year and to increase around mid 2019. If you are eager to learn more about the domestic financial condition according to RBA, refer to the Domestic Economic Conditions file.
Does the Reserve Bank try and sneak announce rate rises during the nation's biggest racing event? Here's what we know.
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when will rates increase
Hi Mark,
At this stage it’s impossible to say. The outlook for the moment is for rates to either fall slightly further or stay where they are, over the next 6-12 months.
Beyond that we just don’t know. For rates to start rising we’d need to see a big increase in inflation at least.
When the RBA decreases the cash rate , does it mean it prints more money to increase money supply and thereby decreasing the borrowing rate. And if that is the case, does increasing the cash rate mean that the RBA has to extinguish some of the money supply thereby reducing the money available to borrow. I am assuming that RBA can’t just simply say the cash rate is this much, it has to increase/decrease money supply at the backend to make sure the cash rate stays at whatever level it wants to stay at.
Hi,
The cash rate determines the interest rate lenders can charge when lending money to each other at short notice (also called the overnight cash rate). Lenders and banks are always moving money around to cover different investments and expenses, including funding for home loans.
So the cash rate affects their costs, and they pass this onto borrowers. Changing the cash rate target does nothing to the amount of money in the economy. It affects the cost of borrowing and lending money.
The RBA does in effect create money sometimes, in a process called quantitative easing. This involves purchasing bonds from investors at a favourable rate, freeing up investor cash to go elsewhere in the economy. This is different to the cash rate.
I hope this helps.
Regards,
Richard
how long can AUD interest rate remain Low…..?
how soon will the AUD follow the US FED Rate Hike…….?
thank you
Hi Octo!
Thanks for getting in touch!
To know more information on your questions, you can fill in your email address in the box provided and you’ll be updated on RBA’s decisions on the official cash rate target.
While we provide you with general information, please know that we don’t stand as a representation for RBA or any company featured on our site.
Hope that clarifies!
Cheers,
Nikki
Do you think the cash rate will stay the same at the June RBA meeting?
Hi Taneesha,
Thanks for getting in touch with finder. I hope all is well for you. :)
Unfortunately, we are not in the best place to make a prediction. However, you might get an idea whether the RBA cash rate will rise or fall by looking at the factors that affect it. These factors may include:
– Household debt
– Inflation
– Wage growth
– Consumer Confidence Index
– Unemployment
I hope this helps. Should you have further questions, please don’t hesitate to reach us out again.
Have a wonderful day!
Cheers,
Joshua
What do you think that how the international economic condition influence the cash rate?
Hi Brook,
Thank you for getting in touch with Finder.
This is a nice question. Domestic financial conditions remain expansionary. There has been some tightening in short-term
money markets, which has flowed through to a small increase in funding costs for a range of financial institutions and businesses. However, borrowing rates remain low for households and businesses. Growth in housing credit has eased since mid last year, particularly for credit extended to investors, while growth in business debt has remained moderate. The Australian dollar remains within its narrow range of the past two years. Financial market prices suggest that the cash rate is expected to remain unchanged this year and to increase around mid 2019. If you are eager to learn more about the domestic financial condition according to RBA, refer to the Domestic Economic Conditions file.
I hope this helps.
Have a great day!
Cheers,
Jeni