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RBA cash rate survey

Expert analysis on the Reserve Bank of Australia's cash rate decisions

Updated

hold

0.25%

CASH RATE HOLD

RBA decision made 05 May 2020
  • 95% of our experts correctly predicted no change to the cash rate cut at the latest Reserve Bank meeting on 05 May 2020.
Next rate meeting: The board of the Reserve Bank will meet again on 02 June 2020 to decide the future of the cash rate.

Finder surveys over 40 economists and property experts every month to evaluate the future of the RBA's cash rate decision. Experts also provide commentary on the current state of the property market and the Australian economy and their predictions for the cash rate's future. This page contains recent cash rate analysis and predictions for the next rate decision. We update the page with new forecasts at the end of the month and again on the first Tuesday of the month, when the board of the Reserve Bank meets to make its decision.

Skip ahead to read the latest analysis, see how the cash rate has changed over time and learn more about how the cash rate affects you.

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The latest cash rate analysis from the experts

Here are the most recent cash rate predictions and commentary from the experts in our panel for the April 2020 cash rate decision.

April
HOLD
May
HOLD
It is unlikely the cash rate will move for a number of years
 
April
HOLD
May
HOLD
There are unlikely to be any moves in the near future. The RBA are likely to take a "wait and see" approach and retain the remaining leverage they have. No decisions are likely until the economic repercussions of COVID-19 become clearer.
 
April
HOLD
May
HOLD
The cash rate is as low as its going to go and the next move in rates will be up but its at least three years away, probably more. The RBA has said on several occasions that it regards 0.25% as the effective lower bound for the cash rate. Based on the experience of other countries there is no value in taking rates negative. So any further easing in monetary policy will have to come from quantitative easing. In the meantime the coronavirus related shutdown will cause a big hit to growth that will take years to fully recover from. This in turn will mean that it will be many years before we see full employment and inflation in the target range of 2-3% which in turn will mean rate hikes are many years away.
 
April
HOLD
May
HOLD
The Reserve Bank Governor recently challenged Government to focus on growth and productivity strategies to help the economy, eventually, emerge from the COVID-19 crisis. More efficient taxation solutions including the removal stamp duty is an obvious place to start. Interest rates are already rock bottom and on this score the RBA has done its part.
 
April
HOLD
May
HOLD
The RBA won't be raising the cash rate for the next few years
 
April
HOLD
May
HOLD
COVID impacts seem likely to endure for a period of time and the economy will need support in the medium term to stabalize and then rebuild
 
April
HOLD
May
HOLD
 
April
HOLD
May
HOLD
Indications from RBA that cash rate is likely to remain at its all-time low for a few years
 
April
HOLD
May
HOLD
We are going into an enforced recession. I cannot foresee when this will end as we are showing little or no chance to reverse whilst still in lockdown. The recovery rate will drive
 
April
N/A
May
HOLD
recession/flat economy will last longer than expected
 
April
HOLD
May
HOLD
They should cut to zero or below, but they've said they won't. I hope they change their mind. Anyway, the important things are now happening in fiscal policy - as monetary policy can't do much in this situation.
 
April
HOLD
May
HOLD
The timing of any future cash rate change will depend on how and when the lockdown restrictions are lifted, and on how quickly the economy is expected to spring back
 
April
HOLD
May
HOLD
We are living in an uncertain world, even the budget has been pushed back to October. There are too many unknowns to make any sort of meaningful predictions
 
April
HOLD
May
HOLD
I think interest rates will stay where they are for the foreseeable future and until such time as there is more certainty on where the economy is heading after COVI-19 is brought under control. Right now, I don't expect the outlook to be overly positive for the remainder of this year and probably into next year as well, either here in Australia or overseas. It is difficult to predict if/when interest rates might move when its hard to forecast with reasonable certainty what the economy might look over the next six months, let alone next year.
 
April
HOLD
May
HOLD
The RBA has committed to a cash rate at the effective lower bound for at least the next two years.
 
April
N/A
May
CUT
The impact of the slow down with expectations of a 10 % contraction in H1, combined with expectations in the cash futures market tilted towards a reduction. With effective cash rates at around 0.15 per cent, another reduction may just formalise the current effective rate scenario.
 
April
HOLD
May
HOLD
 
April
HOLD
May
HOLD
RBA on hold at effective zero for many years
 
April
HOLD
May
HOLD
No more interest rate cuts required (not effective below this 'lower bound' of 1/4 %)- and no increases will occur until 'full employment' achieved: 2022/23?
 
April
HOLD
May
HOLD
The RBA has publicly stated the cash rate at 0.25% is the lower bound.
 
April
HOLD
May
HOLD
No change. Rates are already at the lowest level the RBA has indicated they are prepared to go. Next move from here is QE and new fiscal policies to kick start economy after hibernation.
 
April
HOLD
May
HOLD
Following 1-2 years of falling inflation, there is a good chance inflation will eventually pick up, as a belated consequence of massive stimulus.
 
April
HOLD
May
HOLD
Next rate increase is beyond the scope of the dates provided
 
I don't think the RBA will change the cash rate in the next two years as the governor has said.
 
April
N/A
May
HOLD
The RBA has explicitly indicated that it won't raise the cash rate until it has made progress towards full employment and inflation within the 2-3% target band. I am sceptical of forecasts of a 'V-shaped' recovery from the current downturn, and think that the RBA will keep the cash rate at its current level for at least 2 years.
 
April
N/A
May
HOLD
If will be a very long time before the RBA returns to conventional policy. It will wind back its unconventional policy first and then need to see material progress, in terms of recovery, of the labour market - the timeline for this is unknowable at this stage but I was suspect it will be beyond 2022.
 
April
N/A
May
HOLD
The RBA is expected maintain it's current policy to support the economy through COVID-19.
 
April
N/A
May
HOLD
The recovery will be in full swing and inflation pressure may be emerging
 
April
N/A
May
HOLD
The RBA has clearly indicated that the cash rate will not go up for much of the next 3 years.
 
April
N/A
May
HOLD
There is too much uncertainty re the duration of the impact of COVID19. Further rate cuts would not stimulate the economy, and the question now is of the form and nature of QE in 2020 and 2021
 
April
N/A
May
HOLD
I think there may have been some signs of recovery.
 
April
N/A
May
HOLD
I expect the Reserve Bank to hold the cash rate at its monetary policy meeting in May. In his speech on the 21st of April, Governor Lowe said that the cash rate was to remain at 0.25% until we make sustainable progress towards the goal of full employment and inflation. We are still waiting for economic data to reveal the extent of the impact of the COVID-19 pandemic but the latest indicators suggest that interest rates will have to stay low for longer. As expected, consumer sentiment plummeted to an all-time low in April, with Westpac reporting the single biggest monthly decline in the 47 year history of the survey. Social distancing measures have knocked the wind out of the sails of the property market but time will tell if this will translate to declining dwelling values.
 
April
N/A
May
HOLD
The RBA have been consistant in promoting the lower for longer rate environment, and by targeting the 3 year bond rate at 0.25%, it is indicating a period of around three years of rates at the current level.
 
April
N/A
May
HOLD
The RBA has advised they won't go to zero, so the next move must be up, but to a completely unknown timeline.
 
April
N/A
May
HOLD
The RBA will not be in a position to raise rates for at least four years. The current impact on growth dictates rates at the lower bound until the end of 2021. After that, high levels of government and private sector debt will mean the RBA cannot lift interest rates.
 
April
N/A
May
HOLD
Inflation will not increase for a long time keeping rates low
 
April
N/A
May
HOLD
Hard to estimate at this point and will depend on the rate of restrictions being eased and businesses being able to return to trading - will also depend on whether the easing of restriction result in another outbreak and if restrictions are imposed again.
 
April
N/A
May
HOLD
I believe once we come out of ISO and Retail, Tourisum ( within Australia) and Hospitality are at full working capacity the RBA will increase the rate to recoup our holdings
 
Governor Lowe has made it clear in his speeches that the cash rate will remain at its lower bound for some time. We will need to see the removal of the 3-year bond target and the associated unwinding of quantitative easing. A rate hike is therefore not likely to occur within the next three years.
 
April
N/A
May
HOLD
I am not sure if any accommodative (conventional and unconventional) monetary policy measures will help to revive the economy, considering that the COVID-19 crisis has larger effect on the supply-side of the economy relative to the demand-side. I am not sure if flushing the economy with liquidity help to stimulate the economy, unless and until the pandemic is contained.
 
April
N/A
May
HOLD
The rate won't change for a long time
 
April
HOLD
May
CUT
Because of the state of the economy.
 

Watch our latest Australian property market update

How has the cash rate changed over time?

The graph above shows the movement in the official cash rate target. A lower cash rate reduces the cost of borrowing money so more people are encouraged to borrow - stimulating the economy. Higher interest rates tend to encourage spending. This is how a rise or fall in rates affects the level of supply and demand and therefore the level of inflation - which the RBA wants to keep in the target range of 2%-3%.

What is the official cash rate and who sets it?

Once a month, the RBA board meets to decide whether to raise the cash rate, lower it or keep it the same. Their decision will be influenced by a wide range of factors including inflation, the performance of the Aussie dollar, the housing market, Australia's Gross Domestic Product (GDP) and levels of consumer confidence. The board will assess all of these factors in relation to the RBA's goals and objectives before reaching a consensus on what to do with the official cash rate.

The RBA's monetary policy aims to achieve 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; and
  • The economic prosperity and welfare of the people of Australia.

In order to reach those objectives, the RBA sets an inflation target of 2-3% over the medium term. In other words, the RBA wants the Consumer Price Index (CPI, based on the average prices for a range of common goods and services) to increase by between 2 and 3 per cent each year.

The bank can control inflation by making adjustments to the official cash rate. 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.

How the cash rate can impact your finances

See how the cash rate changes can affect your savings, term deposits, home loans and what you can do about it.

If the rate rises

Ask your lender for a rate discount so that if rates do rise you won't be worse off, or alternatively, compare other variable or even fixed rate home loans to find a better deal.

If the rate gets cut

See how your lender responds to the cut. If they don't pass on the full rate cut, ask for a rate discount, and if you're still not happy start comparing what other deals are in the market. Some lenders have been known to pass on more than the official rate cut after an RBA announcement!

If the rate holds

Compare other variable rate home loans to make sure you're still getting the best deal. If rates are tipped to rise in the near future you may also want to compare fixed rates.

If the rate rises

Find an account which offers the same features and fees but with a better rate.

If the rate gets cut

Consider comparing a competitive term deposit rate so your interest earnings don't suffer.

If the rate holds

Carry out a quick comparison to make sure you're getting the best return on your money, see what promotions banks are offering.

If the rate rises

Your rate won't rise as you locked it in, so you can relax a little. If your fixed rate is soon to end, start comparing what deals are being offered so you don't find yourself scrambling to lock in another rate.

If the rate gets cut

If you feel your home loan is no longer competitive, you might want to obtain a quote from your lender to find out possible exit costs. If this figure is reasonable, you might want to consider comparing variable home loans. Use our switching costs calculator to see if you'd save.

If the rate holds

Because your rate is fixed for an agreed period of time, a decision by the RBA to hold won't have as much of an effect on you depending on how long you still have to go in your fixed term. As mentioned above, you might still want to monitor the other deals in the market to keep informed.

If the rate rises

If rates rise, savings accounts rates could be increased as well. If this happens, you might want to compare the rates of high interest savings accounts. Remember that most term deposits have interest penalties if you withdraw your funds early, so keep this in mind.

If the rate gets cut

Your rate won't change because it's locked in, but if you're nearing the end of your term start comparing both high interest savings accounts and term deposits to find a good deal.

If the rate holds

Compare accounts and ensure you're aware of what's being offered in the market.

Check out Finder's RBA survey press releases

RBA news and announcements

Ask an Expert

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46 Responses

  1. Default Gravatar
    octoJune 18, 2018

    how long can AUD interest rate remain Low…..?

    how soon will the AUD follow the US FED Rate Hike…….?

    thank you

    • Default Gravatar
      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

  2. Default Gravatar
    TaneeshaMay 24, 2018

    Do you think the cash rate will stay the same at the June RBA meeting?

    • Avatarfinder Customer Care
      JoshuaMay 24, 2018Staff

      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

  3. Default Gravatar
    BrookMay 5, 2018

    What do you think that how the international economic condition influence the cash rate?

    • Avatarfinder Customer Care
      JeniMay 6, 2018Staff

      Hi Brook,

      Thank you for getting in touch with finder.

      This is 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, please check out this link.

      I hope this helps.

      Have a great day!

      Cheers,
      Jeni

  4. Default Gravatar
    RobJune 11, 2017

    What do you think will be the next move for RBA on cash rate and when?

    Thank you!

    • Default Gravatar
      JonathanJune 11, 2017

      Hi Rob!

      Thanks for the comment.

      As of the moment, most of resident rate experts predict that rates will be the same. The cash rate target is released on the first Tuesday of every month except January.

      You can follow the updated forecast right here.

      Hope this helps.

      Cheers,
      Jonathan

    • Default Gravatar
      RobJune 11, 2017

      Thanks Jonathan, I meant in the longer term, 6-12 months.

    • Default Gravatar
      JonathanJune 11, 2017

      Hi Rob!

      We appreciate your follow-up.

      Currently, there are multiple factors that need to be considered and due to the volatility of these factors, it is a bit hard to conclude whether they’ll leave the rates unchanged for the next few months or not.

      If you have further inquiries, you may contact:

      Media and Communications
      Secretary’s Department
      Reserve Bank of Australia
      SYDNEY
      Phone: +61 2 9551 9720
      Fax: +61 2 9551 8033
      Email: rbainfo@rba.gov.au

      Hope this helps.

      Cheers,
      Jonathan

  5. Default Gravatar
    JulieSeptember 1, 2016

    When do you think the RBA will start raising rates?

    • Default Gravatar
      JodieSeptember 7, 2016

      Hi Julie,

      Thank you for contacting finder.com.au we are a financial comparison website and general information service.

      It is hard to predict the movement of the cash rate as it is based on a multitude of factors that are continually changing however 7 out of the 38 experts we surveyed in our latest RBA survey for September 2016 said they predict it will start going up in July 2017 or beyond.

      Regards
      Jodie

  6. Default Gravatar
    EricFebruary 25, 2016

    Hi Belinda

    Appreciate if you would also send me informations regarding findings of monthly RBA survey.

    Regards
    Eric

    • Avatarfinder Customer Care
      BelindaFebruary 26, 2016Staff

      Hi Eric,

      Thanks for getting in touch.

      On this page, you can view the RBA Cash Rate Target Announcements for each month from February 2015 until February 2016. You can also view the commentary of our resident rate experts in the lead up to each Board meeting which occurs on the first Tuesday of every month (except January).

      Please feel free to sign up to receive our detailed RBA cash rate updates by completing the form provided above.

      Regards,
      Belinda

  7. Default Gravatar
    SyedDecember 8, 2015

    Hi,
    My new house is ready now and wondering what is the best time to sell, should I put my house in the market now or January or wait for the February. I am not committed any where so I can wait.

    Your advise needed.

    Thanks

    • Avatarfinder Customer Care
      BelindaDecember 9, 2015Staff

      Hi Syed,

      Thanks for your enquiry.

      As finder.com.au is an online comparison service so we are not licensed to give you personal advice regarding the best time to sell your property.

      You can read our guide here about considerations when selling your house.

      All the best,
      Belinda

  8. Default Gravatar
    loooooolAugust 16, 2015

    hello.
    i wonder if i could receive some information regarding not only the latest current economic situation, but also cash rate movements over the year.

    • Avatarfinder Customer Care
      BelindaAugust 17, 2015Staff

      Hi Dongho,

      Thanks for your enquiry.

      Above on this page you can view the ‘Reserve Bank monthly announcements’ to read about the cash rate movements and monetary policy decisions that have occurred over the course of this year. You can also sign up to receive our RBA cash rate updates by filling in the form provided above.

      In regards to the current economic situation, finder.com.au is an online comparative website and we can’t comment on the activity of the broader Australian economy.

      Thanks,
      Belinda

  9. Default Gravatar
    OliJuly 17, 2015

    Can you please send through the information on the RBA via email?
    I’m doing a school Economic assignment on the RBA and financial markets

    • Avatarfinder Customer Care
      BelindaJuly 17, 2015Staff

      Hi Oli,

      Thanks for your enquiry.

      I’ve emailed you with some information regarding the findings from our monthly RBA survey.

      Please note that on this page you can sign up to receive our RBA cash rate updates.

      Thanks,
      Belinda

  10. Default Gravatar
    yazminJuly 7, 2015

    Hi,

    I was just wondering if I could have information regarding how interests rates will unfold over the next year. In particular, if the current interest rates will be appropriate for the economic conditions in Australia.

    Thank you
    Yazmin

    • Avatarfinder Customer Care
      BelindaJuly 8, 2015Staff

      Hi Yazmin,

      Thanks for your enquiry.

      Firstly, I’d like to point out that finder.com.au is an online comparison and general information service so we’re not in a position to forecast interest rates.

      However, on this page you can sign up to receive our RBA cash rate updates which you might find useful.

      Thanks,
      Belinda

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