RBA cash rate

Find the current RBA cash rate, read expert forecasts on the bank's next move and learn what it all means for your finances.

Updated . What changed?

Fact checked
hold

0.10%

CASH RATE HOLD

RBA decision made 01 December 2020

We’re reader-supported and may be paid when you visit links to partner sites. We don’t compare all products in the market, but we’re working on it!

  • 100% of our experts correctly predicted that the RBA would hold the cash rate at its meeting on 01 December 2020
  • The official cash rate remains at the historic low of 0.10%
Next rate meeting: The board of the Reserve Bank meets on 02 February 2021 to decide the future of the cash rate.

Finder surveys over 40 economists and property experts every month to forecast the RBA's next cash rate decision. Experts also provide commentary on the current state of the property market and the Australian economy. 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.

Every month (except January) the Reserve Bank of Australia sets the official cash rate. This rate affects the borrowing costs of banks and in turn affects interest rates on home loans, savings accounts and more. The cash rate is not only an indicator of the country's economic health. It has a direct impact on many Australian borrowers' home loan interest rates.

Read on to see our expert predictions on the cash rate and learn what the cash rate is and how it affects your financial products.

By signing up, you agree to the finder.com.au Privacy & Cookies Policy and Terms of Use, Disclaimer & Privacy Policy

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 December 2020 cash rate decision.

November
CUT
December
HOLD
Given that the cash rate is already at 0.1% and the RBA does not want to take it negative the next move is likely to be a hike. But given the high level of spare capacity in the economy, inflation is unlikely to meet the RBA’s conditions for a hike of being sustainably within the 2-3% target range for another 3 years or so. As a result the first rate hike hike is unlikely until sometime in 2024.

November
CUT
December
HOLD
Like most industries and consumers as well, we’re hopeful the cash rate remains unchanged for some time. The Reserve Bank recently made the landmark move and it will take some time to ascertain its success in supporting the economic recovery. We see the cash rate remaining steady until well into the new year.

November
CUT
December
HOLD
The RBA will now wait and see how effective their recent interest rate cut and the QE program is

November
HOLD
December
HOLD
RBA won't go to Zero but will want to see a few quarters of positive growth before increasing.

November
HOLD
December
HOLD
All I'm saying is that increases look to be a long time coming.

November
CUT
December
HOLD
I think the RBA's commitment not to raise the cash rate for at least three years is credible ... but 2023 wasn't an option in the answers to this question

November
CUT
December
HOLD
Low rates are here for years. The big question is whether they will move to negative rates.

November
CUT
December
HOLD
There appears little justification for further cuts to the cash rate. In fact, interest rates have probably reached their floor. This is because the relative success of the Federal Government's stimulus packages combined with various State based initiatives, has carried the economy such that the time has come to focus less on monetary policy, and more on fiscal policy. The last thing the economy needs right now is zero or negative interest rates.

November
CUT
December
HOLD
RBA commitment to keep rates at affective zero for 3 years

November
CUT
December
HOLD
The RBA has cut the official cash rate to its effective lower bound at 0.1 %, and will stay at this floor for some years. The next tightening cycle may commence in FY23. Further monetary stimulus if needed will come in the form of expanded QE, but negative interest rates are not on the table.

November
HOLD
December
HOLD
Large scale monetisation of government bonds must eventually put upward pressure on inflation as economies recover from the Covid recession. If economic theory and history are any guide, a rise in the official cash rate will then be necessary. World interest rates should start to rise as markets become saturated with government bonds that continue to be issued on a massive scale. A rate to watch is the rate on long dated US bonds.

November
CUT
December
HOLD
The RBA has a new target: it won't increase the cash rate until actual (not forecast) unemployment is much lower and actual (not forecast) inflation is in the 2-3 per cent range. That will be well beyond end-2022.

November
HOLD
December
HOLD
No further rate cuts. RBA has said they will not go to negative rates. Rates likely to stay at this level for 3 years

November
HOLD
December
HOLD
Global rates will remain low due to Covid19

November
CUT
December
HOLD
In May We were the first to forecast that the RBA would launch QE in earnest with markets and the consensus forecast only coming around to our view in recent months. In November we were proved right. Looking ahead we think the Australian economy is poised to recovery faster than most expect.

November
CUT
December
HOLD
After last month’s reduction in the cash rate, to close to zero, the RBA will look to support and stimulate the economy via other measures moving forward. One of the main beneficiaries, of the ongoing record low rates, has been property markets with LJ Hooker agents reporting a significant increase in enquiry and strong levels of sales transaction volumes.

November
HOLD
December
HOLD
I think that by the second half of 2021, there should be signals that the rates have achieved their goals and there will be a review.

November
CUT
December
HOLD
I expect the RBA to hold the cash rate at its last meeting in 2020. In the minutes of the November monetary policy meeting, members said that negative rates were extraordinarily unlikely, suggesting we may not see another reduction to the cash rate so soon. That being said, the historic low cash rate is supporting the lowest borrowing cost on record and driving activity in the nation’s housing market. It is also encouraging a surge in refinancing from borrowers looking for a better deal.

November
CUT
December
HOLD
RBA monetary policy indicates QE and a period of sustained low rates will remain

November
HOLD
December
HOLD
The RBA is unlikely to increase at the moment.

November
CUT
December
HOLD
I think the RBA is extremely reluctant to cut further and take rates negative while I also think they may be somewhat optimistic in their forecasts around a rebound in inflation. I don't see an increase until after 2022 and if anything a move lower, albeit very reluctantly, looks more likely than an increase but I am still unsure that would occur.

November
CUT
December
HOLD
I expect --without high confidence--that inflationary pressures will emerge by the second half of 2022.

November
HOLD
December
HOLD
Next time is up, but who knows just which year.

November
CUT
December
HOLD
The RBA has provided forward guidance that the cash rate should not be increased until about 3 years after the COVID-19 shock

November
CUT
December
HOLD
The RBA's forward guidance has turned a little more dovish. It will be quite some time before their conditions for a rate increase are met.

November
HOLD
December
HOLD
Whilst Australia is coming out of the COVID climate that has plunged us into a recession, things are not as bad as they could be and so the recession is likely to be short lived and so interest rates are unlikely to fall further. The release of figures around retail spending and GDP in this second quarter will be an indication as to whether rates will rise in 2021 or remain at currently levels. If retail spending is strong then a movement in rates will occur earlier rather than later.

November
CUT
December
HOLD
Too many unknowns

November
HOLD
December
HOLD
Conventional monetary policy is unlikely to be utilised to manage stimulus out of CoVID, but will be used to manage a quickly growing economy post CoVID.

November
CUT
December
HOLD
Nothing for forecast period re rate rises If further support needed will be via QE

November
HOLD
December
HOLD
There must be a recovery at some stage

November
N/A
December
HOLD
they have indicated cash rate unchanged for 3 years however the recovery from covid appears to be going faster than anticipated hence the RBA may adjust the cash rate earlier than 3 years although the timing is highly uncertain

November
N/A
December
HOLD
Subdued economic conditions will continue to require strong monetary stimulus for at least the next three years.

November
N/A
December
HOLD
RBA has signalled holding rates low until 2023 at the earliest.

November
N/A
December
HOLD
There's renewed confidence in the marketplace. The next change in the cash rate will be an increase but the timing on that is difficult to predict as there are numerous factors, including the availability of a COVID-19 vaccine, to consider. The market doesn't need a rate cut at the moment - it needs easier access to finance. There's no shortage of pre-approvals at the moment. In many suburbs it's now cheaper to pay a mortgage than to rent. We're seeing the economy stabilise relatively quickly. The economy has proved to be much more resilient than first thought.

How has the cash rate changed over time?

The graph below shows the movements in the official cash rate over time and is updated every month whenever the RBA announces a cut, raise or hold.

What is the official cash rate?

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.

Their decision is influenced by 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.

How the cash rate can impact your finances

A lower cash rate means borrowing money is cheaper. That's good news for people with mortgages, especially variable rate home loans, which are directly affected by the cash rate (fixed rate loans, as the name implies, don't change until the fixed period ends).

A higher cash rate makes borrowing money more expensive. But it also means interest rates on savings accounts can increase, which is good for savers.

The RBA generally moves the cash rate in increments of 0.25%, though it did make cuts of 0.10% and 0.15% in 2020. The cash rate is currently 0.10%, which is the lowest it has been in several decades.

Here's an example of how a change to the cash rate can affect a home loan. Let's assume the following:

  • The RBA has reduced the cash rate by 0.25%.
  • You have a variable rate home loan.
  • Your lender passes on the RBA's raise or cut in full.
  • Your loan term is 30 years.

Let's look at some example home loans:

Cash rate cut

  • Loan amount: $400,000
  • Interest rate: 3.50%
  • Monthly repayment: $1,796
  • Rate cut: -0.25%
  • New rate: 3.25%
  • New monthly repayment: $1,740
  • Saving: $56 a month or $672 a year

Cash rate rise

  • Loan amount: $600,000
  • Interest rate: 3.50%
  • Monthly repayment: $2,694
  • Rate rise: 0.25%
  • New rate: 3.75%
  • New monthly repayment: $2,778
  • Extra cost: $84 a month or $1,008 a year

What should I do if the cash rate changes?

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

If the cash rate rises

Check your loan's interest rate. If it has increased, ask your lender for a rate discount or see if they have a similar product with a better rate. You should also look at other rates on the market and consider refinancing if you find a cheaper loan.

If the cash 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 cash 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 cash rate rises

Find a high interest savings account which offers the same features and fees but with a better rate.

If the cash rate gets cut

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

If the cash 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 and find out if switching is worth your while.

Fixed rate home loans aren't directly affected by changes to the cash rate. But the cash rate does influence lenders decisions to set fixed rates. If you're already on a fixed rate loan there's not much you can do until the fixed rate period ends.

It is possible to exit a loan during the fixed period but there are break costs for doing so.

If the cash 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 cash 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 cash 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 cash 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 cash 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 cash 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

More guides on Finder

Ask an Expert

You are about to post a question on finder.com.au:

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • finder.com.au is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Finder only provides general advice and factual information, so consider your own circumstances, or seek advice before you decide to act on our content. By submitting a question, you're accepting our Terms of Use, Disclaimer & Privacy Policy and Privacy & Cookies Policy.

46 Responses

    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

    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

    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

    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

    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

    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

    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

    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

    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

    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

Go to site