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- 23% of our experts correctly predicted the RBA would increase the cash rate at its meeting on 03 May 2022.
- The official cash rate is now at 0.35%.
Next rate meeting: The board of the Reserve Bank meets again on 07 June 2022 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.
The RBA sets the official cash rate. This affects interest rates on home loans, savings accounts and other financial products. Rate cuts or increases have a big effect on borrowing costs and the Australian economy. The bank's board meets every month (except January) to decide the future of the cash rate.
On this page you can see our panel of experts and their predictions on future rate cuts or increases.
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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 May 2022 cash rate decision.
Shane Oliver
Shane Oliver
April
HOLDMay
RAISEInflation has blown out to above 5%, full employment has been reached and its now only a matter of time before official wages data picks up. Delaying further will risk a rise inflation expectations making it harder to get inflation back down.
Geoffrey Kingston
Geoffrey Kingston
April
HOLDMay
HOLDI'm guessing the RBA will hold off until June because of sharemarkets wobbles
Michael Yardney
Michael Yardney
April
HOLDMay
HOLDThe RBA seems to have changed it's stance and rather than patiently waiting for wages to rise, will look to tackle rising inflation sooner rather than later
Nicholas Gruen
Nicholas Gruen
April
HOLDMay
HOLDI have always thought the RBA would move faster than they have foreshadowed they will as calls come to restrain inflation.
Saul Eslake
Saul Eslake
April
HOLDMay
HOLDThere's likely to be a case for raising rates at the May meeting (assuming the March quarter CPI out on Wednesday, after the deadline for completing this survey) shows 'headline' inflation above 4% and 'underlying' inflation above 3%. But the RBA seems (taking its words at face value) inclined to wait until after it has seen the March quarter WPI data, which doesn't come out until 18th May. So that points to June. I'm not sure the March quarter WPI will show a significant acceleration in wage inflation, but if the RBA isn't going to do the first increase in May, they may well end up doing 40bp in June.
Noel Whittaker
Noel Whittaker
April
HOLDMay
HOLDWe all know rate increases are coming but I don't think they will do it just before the election.
David Robertson
David Robertson
April
HOLDMay
RAISEThe CPI data including a core inflation rate of 3.7% adds even more urgency for the RBA to lift interest rates. A May hike of 15 basis points followed by 25 bp in June taking the cash rate to 0.5 % is now more likely given this data and with unemployment trending below 4%.
Dr Craig Emerson
Dr Craig Emerson
April
HOLDMay
RAISEThe RBA might well judge that the trimmed mean inflation rate does not warrant a cash rate at the emergency low level of 0.1 per cent.
Rich Harvey
Rich Harvey
April
HOLDMay
HOLDThe RBA has changed their perspective and dialogue in the previous months board minutes. With inflationary pressures building strong momentum, the RBA is awaiting confirmation that wages growth is actually filtering through the economy. They are likely to move 0.15% on first increase then a series of 0.25% increases over the next 12 months in line with ongoing economic data. The era of super cheap money is over for now.
Jonathan Chancellor
Jonathan Chancellor
April
HOLDMay
RAISEThe RBA has the confirmation it awaited of inflation necessitating the rise
Dale Gillham
Dale Gillham
April
HOLDMay
HOLDAll the banks are factoring in rate rises and so I would think after the Federal election we will see an upward movement in rates. We are in a very low rate environment and a long way from what is normal and so continual rate rises over the next few years should be of no surprise.
Nicholas Frappell
Nicholas Frappell
April
HOLDMay
HOLDAustralian CPI figures were high but hard to say if high enough to bring tightening forward.
Tim Nelson
Tim Nelson
April
HOLDMay
HOLDInflationary pressures are building and RBA will seek to get ahead of these.
Mark Crosby
Mark Crosby
April
HOLDMay
HOLDIt will be very clear that inflation is now baked in, and so time to move rates towards some level of normality. The aim for the cash rate should be to 1.5% by year end at a minimum.
Brodie Haupt
Brodie Haupt
April
HOLDMay
HOLDWith continued uncertainty and rising pressure from inflation, I think it is likely there will be a change to the cash rate this year at some point. Monetary policy typically lags in taking effect on the economy.
Mathew Tiller
Mathew Tiller
April
HOLDMay
HOLDInflationary pressures have continued to accelerate across the globe and Australia has not been immune, this means a rate rise is just around the corner. If the RBA doesn’t lift the cash rate in May (due in part to the upcoming Federal Election) it will more than likely do so in June.
Christine Williams
Christine Williams
April
HOLDMay
HOLDThe timing will depend on which party wins the Federal Election My thoughts if Liberals will the RBA will wait until last quarter, watching the employment rate and inflation rate, if Labour wins, I feel the RBA will increase within 3 months of election.
Jason Azzopardi
Jason Azzopardi
April
HOLDMay
HOLDI previously believed a November date however the case for an increase earlier is becoming increasing compelling which coincided with tone of RBA messaging changing recently.
Leanne Pilkington
Leanne Pilkington
April
HOLDMay
HOLDIt's a close call, as inflationary pressures demand attention despite the Reserve Bank being open in its preference not to lift rates ahead of the election. Assuming a rate rise is imminent, it’s not only a question of when but by how much?
Angela Jackson
Angela Jackson
April
HOLDMay
RAISELatest inflation and employment data warrants commencement of further monetary policy settings.
Annette Beacher
Annette Beacher
April
HOLDMay
HOLDSHOULD hike by 15bp in May, but failing that SHOULD hike 40bp in June. What will they do? Who knows!
Stephen Koukoulas
Stephen Koukoulas
April
RAISEMay
RAISEHigh inflation being persistent
Malcolm Wood
Malcolm Wood
April
HOLDMay
RAISEInflation is now sustainably back in the RBA's band, the economy is strong and the labour market is tight
David Zammit
David Zammit
April
HOLDMay
HOLDThe economy is strong, with the unemployment rate sitting at a record low and while inflation is rising, it is unlikely the RBA will lift the cash rate right before the Federal Election, so I don’t expect to see a change in May. However, a compelling case is building for a move in June pending the results of the March quarter CPI and wage price index, which will be released later this month.
Inflation is surging and the RBA is coming around to our view that it needs to act. We expect the Bank to wait until after the federal election is wrapped up before starting its hiking cycle in June. thereafter we think the Bank will hike rates at every meeting this year lifting the cash rate to 1.75% by the end of the year.
Jakob Madsen
Jakob Madsen
April
HOLDMay
HOLDInflation is will start to become more fundamental because of inertia and low unemployment
Dr Andrew Wilson
Dr Andrew Wilson
April
N/AMay
HOLDAlthough the RBA has recently moderated its stance on the timing of a rate incease, it remains unclear whether it will now abandon its stated position of awaiting a consistent period of stong wages growth before acting. The official data confiming this possibile outcome will not become available til late August.
Stephen Halmarick
Stephen Halmarick
April
N/AMay
HOLDPost CPI and wages data.
Cameron Kusher
Cameron Kusher
April
N/AMay
HOLDThe RBA appears to have been overrun by market expectations. They had been willing to be patient but as everyone moved their expectations to June there was little if any pushback from the RBA or any of the journalists perceived to have a line into the RBA.
Alan Oster
Alan Oster
April
N/AMay
HOLDWage and price pressures growing as economy strengthens No need for super low rates now
Tim Reardon
Tim Reardon
April
N/AMay
HOLDThis will give the RBA two more CPI readings and one more wage price index reading, and enough confidence that inflation is sustainably within its 2-3 per cent target band.
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
The RBA can do three things with the cash rate: increase it, lower it, or hold it. The bank generally moves the cash rate in increments of 0.25%, though it did make cuts of 0.10% and 0.15% in 2020.
What does a cash rate increase mean for you?
A higher cash rate makes borrowing money more expensive. This is bad news for borrowers. But it also means interest rates on savings accounts can increase, which is good for savers.
Here's how a cash rate rise affects your finances.
- If you have a home loan. If you have a fixed rate home loan you don't need to worry. Your rate will not rise during the fixed period. If you have a variable rate home loan your lender might increase your home loan rate in response to the RBA's decision. If this is the case, you should start comparing home loans and look for a better deal.
- If you have money in a high interest savings account. Rate rises mean higher interest rates on savings accounts. Again, look around and see if you can find a high interest savings account with a better rate.
What does a cash rate decrease mean for you?
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).
Here's how a cash rate cut affects your finances.
- If you have a home loan. If you have a variable rate loan, see how your lender responds to the cut. If your lender doesn'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. If you have a fixed rate loan you won't see any benefit now because your rate is fixed.
- If you have money in a high interest savings account. Your interest rate will likely fall. You might still be able to find a better deal elsewhere. If you are hoping to generate some wealth through interest you might choose to put your money in a term deposit or an investment fund instead.
Here's an example of how a cash rate cut or rise can affect a home loan. Let's assume the following:
- You have a variable rate home loan with a rate of 2.50% before the RBA decision.
- 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 rise
- Loan amount: $450,000
- Interest rate: 2.50%
- Monthly repayment: $1,778
- Rate rise: 0.25%
- New rate: 2.75%
- New monthly repayment: $1,837
- Extra cost: $59 a month or $708 a year
Cash rate cut
- Loan amount: $450,000
- Interest rate: 2.50%
- Monthly repayment: $1,778
- Rate cut: -0.25%
- New rate: 2.25%
- New monthly repayment: $1,720
- Saving: $58 a month or $696 a year
Check out Finder's RBA survey press releases
Pre-announcement RBA Press Releases
- Finder’s RBA survey: 84% of experts say the cash rate will move by August
- Finder’s RBA survey: 88% of experts expect a rate rise at least once in 2022
- Finder’s RBA survey: Home loan costs to rise, but not savings rates
- Finder’s RBA survey: 58% of economists expect a rate rise in 2022
- Finder’s RBA survey: 73% of experts say rental prices will increase significantly
- Finder’s RBA survey: Sydney property prices to rise another $102,000 in 2022
- RBA survey: 56% of experts predict a cashless Australia by 2031
- 82% of experts say vaccine passports are an economic necessity
Post-announcement RBA Press Releases
- Finder’s RBA survey: Cash rate rises for first time in over a decade
- Finder’s RBA survey: Experts predict property prices to cool as rate rise looms
- Finder’s RBA survey: Stamp duty to go? 54% of experts say a property tax could help first home buyers
- Finder’s RBA survey: Sydney property prices to rise by $46,000 this year
- Finder’s RBA survey: 77% of experts say major banks will follow CBA’s crypto decision
- Finder’s RBA Survey: 68% foresee a labour shortage as international travel returns
- RBA Survey: Half of experts say Big Four will raise rates out of cycle, cash rate holds
- RBA Survey: Experts predict $76,000 increase in property in next 12 months
RBA news and announcements
RBA lifts cash rate for first time since 2010: What do I do?
Borrowers need to watch out for their lenders raising rates in the coming days or weeks and consider switching to a better deal.
Read more…
RBA holds cash rate – but you should still check your interest rate
Your home loan might be safe for now, but rate rises are coming and you need to be prepared.
Read more…
RBA’s March cash rate decision is good news for borrowers
The cash rate stays at 0.10% as predicted, but some lenders are moving rates upward regardless. What can you do if your bank is one of them?
Read more…
RBA’s cash rate hold gives borrowers breathing room – for now
No rate rise at this month's board meeting means borrowers have at least one more month of historically low rates, and the chance to lock in a good deal now.
Read more…More guides on Finder
-
Banks passing on the August RBA cut on savings accounts
A full round-up of Australian banks that have announced rate changes for savings accounts.
-
What lenders have passed on the RBA rate cut?
At the May 2015 meeting, the RBA chose to cut the cash rate by 25 basis point, see which lenders chose to pass on the full cut to interest rates.
-
Why the banks have passed on the May RBA Rate Cut
In May, the Reserve Bank of Australia (RBA) cut interest rates to its lowest on record and many banks passed it on.
Ask an Expert
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
What do you think will be the next move for RBA on cash rate and when?
Thank you!
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 RBA forecast through our website.
Hope this helps.
Cheers,
Jonathan
Thanks Jonathan, I meant in the longer term, 6-12 months.
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
When do you think the RBA will start raising rates?
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