RBA Cash Rate

Your destination for RBA news, expert forecasts and more

hold

1.50%

Cash rate held

at 1.50% on Tuesday 7 August 2018

The Reserve Bank of Australia (RBA) sets the official cash rate target on the first Tuesday of every month except January. Below are expert forecasts from the finder.com.au Reserve Bank Survey™ of some of Australia's brightest minds in economics and property. You can also learn more about the RBA and how its decisions influence the interest rates banks charge, and learn about the best strategies for home owners and investors when there's a rate cut, hold or rise decision.

100% of the experts in our survey correctly predicted that the cash rate would hold.

100%of our resident rate experts

correctly predicted the rate to hold at 1.50% on Tuesday 7 August 2018 View forecasts →

Next meeting: 2:30pm 4th September 2018

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Our resident rate experts

+ Open all commentary

Find out what each of our experts predicts for next month and their detailed forecast explanations

July

N/A

August

No change

Although overall economic growth is now close to trend, unemployment (and especially underemployment) remain higher than the RBA wants, while the June quarter CPI data showed underlying inflation still running below the lower bound of the RBA’s target range. And most measures of wage inflation remain at or close to historic lows. It’s difficult to envisage the RBA Board altering its conclusion that the next movement in rates is some way off.

Photo of Jo Horton
July

N/A

August

No change

Economic growth is solid, business conditions are elevated and jobs growth is strong. There are risks to the global economy, including trade concerns and the domestic economy, including housing. There are downside risks emanating from a tightening in lending standards and recent upward pressure on wholesale funding costs, as recently highlighted by the RBA. This suggests the RBA will leave interest rates on hold for an extended period.

July

No change

August

No change

The June Quarter CPI, and the revisions to our inflation forecasts are consistent with an RBA on hold out to the end of 2019.

July

No change

August

No change

Latest data strengthens case for continuing steady outlook for official interest rates with underlying June quarter inflation low and stagnant. Wages Index data to be released soon may fuel growing concerns that the economy may require more stimulus to offset chronically low consumption, rising fuel and energy costs and the emerging prospect of a trade barriers.

Leanne Pilkington
July

No change

August

No change

Weak underlying inflation strengthens the case for the RBA to leave rates on hold. The housing market requires this stability at the moment.

July

No change

August

No change

Still too early to move. Wages need more momentum. House prices also flat to falling.

July

No change

August

No change

I expect the RBA to hold the official cash rate at 1.5% in August 2018 because despite good global economic growth, the domestic economy is below expectations with wages and inflation likely to remain low. New tightened lending standards and increased scrutiny around borrower living expenses coupled with cooling property prices will also play a factor in the RBA’s decisions to hold.

July

N/A

August

No change

Low inflation and lack of wages growth indicates no hurry to act on rates.

MIchaelYardneyHeadshot100px
July

No change

August

No change

There is no reason to alter interest rates. Our weakening housing markets, low inflation rate and soft wages growth suggest no rise in rates is imminent. If anything this would dampen already sluggish consumer confidence.

July

No change

August

No change

Australia's economy is creating healthy volumes of new jobs, although the majority of these are part time. Inflation and wage pressures are under control, while dwelling prices have softened in both Sydney and Melbourne. This is not the time for interest rates to rise. The likelihood that the next move will be downward is growing.

July

No change

August

No change

Growth has picked up a bit and the RBA is optimistic, but inflation and wages remain too low, property prices are falling in Sydney and Melbourne, the housing construction cycle has peaked and uncertainty remains around the outlook for consumer spending. So its way too early to hike, but hard to mount a case for a cut either right now. So best to remain on hold.

AlisonBoothANU
July

No change

August

No change

Fundamentals don't yet suggest the interest rate needs to change.

July

No change

August

No change

No reason to move.

Alex Joiner
July

No change

August

No change

The data flow hasn't improved materially enough over recent months to warrant the RBA shifting its current cautiously optimistic bias.

July

No change

August

No change

The RBA is increasingly worried that financial conditions will be tightened by banks raising their mortgage rates and using stricter credit criteria, so it will keep interest rates at 1.5% so as not to make things worse.

John Hewson
July

N/A

August

No change

Household debt/global uncertainty.

Holden_Richard 1
July

N/A

August

No change

Low inflation; low wage growth; housing price pressure.

Jonathan Chancellor

+ Read Jonathan's full forecast
July

N/A

August

No change

There's nothing but watching and waiting on the RBA agenda for the time being.

PeterGilmore
July

No change

August

No change

Glacial change in local fundamentals and global volatility will see the RBA sit tight.

Mathew Tiller LJ Hooker
July

N/A

August

No change

Economic conditions don't support any movement in the cash rate at present.

July

No change

August

No change

Despite strong employment data, the weaker than expected CPI figures together with subdued wage growth and concerns around inflation and household debt levels, will likely keep rates on hold.

Malcolm Wood
July

No change

August

No change

Need for on-going policy support given households under pressure, easing stages of a housing downturn, China slowdown and underlying inflation around low-end of target.

Clement Allan Tisdell

Clement Allan Tisdell

+ Read Clement's full forecast
July

No change

August

No change

High level of debt and low rate of increase in prices.

July

No change

August

No change

RBA has strongly signalled that rates will remain on hold for at least a few months, and most likely into 2019.

July

No change

August

No change

The June quarter CPI report has buried recent commentary that the RBA should be considering a rate increase.

Jordan Eliseo
July

No change

August

No change

The RBA's view on monetary policy is clearly changing, with a more dovish tone at the very least pushing back the timeframe for rate hikes, if not already opening the door to an eventual rate cut, which is still our base case in the coming months. Growth figures and employment levels are still reasonable though, so they'll continue to take a "wait and see" approach for now.

July

No change

August

No change

Material uncertainty in the economy.

Stephen Koukoulas

+ Read Stephen's full forecast
July

N/A

August

No change

The RBA will hold rates because it continues to place a higher priority on reducing house prices than meeting its inflation target and tackling the slack in the labour market. It should be cutting interest rates.

Peter Haller
July

No change

August

No change

There is no rationale for the RBA to change rates at this point in time.

July

No change

August

No change

Private non-mining business investment is strong, inflation has remained low and household debt and housing conditions indicate that a steady approach is likely.

June

N/A

July

No change

No material change in economic conditions from prior period.

Check out finder's RBA survey press releases

History of the Reserve Bank of Australia official Cash Rate

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%.

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

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

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

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.

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

    • finder Customer Care
      NikkiJune 20, 2018Staff

      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?

    • finder 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?

    • finder 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

    • finder 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

    • finder 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.

    • finder 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

    • finder 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

    • finder 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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