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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.
- At its latest meeting on 07 July 2020 the Reserve Bank of Australia decided to hold the cash rate at its historic low of 0.25%.
- 100% of our experts correctly forecast the RBA's decision.
Next rate meeting: The board of the Reserve Bank meets on 04 August 2020 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.
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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 July 2020 cash rate decision.
Michael Yardney
Michael Yardney
June
HOLDJuly
HOLDThe RBA have indicated it will not raise interest rates until unemployment levels fall to around 4.5%. This is many years away
Dr Andrew Wilson
Dr Andrew Wilson
June
HOLDJuly
HOLDMonetary policy will continue to be sidelined over foreseeable future with no logical purpose served by a further cut to 0% and the prospect of a rise fanciful given economic conditions set to worsen
Shane Oliver
Shane Oliver
June
HOLDJuly
HOLDThe RBA will remain on hold. There is little to no value in taking rates to zero or negative and given the recession, high unemployment, uncertainty about the recovery and inflation running way below target its way too early to think about raising rates. In fact its unlikely to be able to raise rates for the next three years at least.
Leanne Pilkington
Leanne Pilkington
June
HOLDJuly
HOLDWe have years of low interest rates ahead of us and the banks themselves have sharpened their pencils in recent times, cutting their rates on various products to remain competitive. The pandemic continues to cast a shadow over the economy and the outlook is meagre, but for those whose income remains secure, a real estate purchase is comparatively affordable at present.
Trent Wiltshire
Trent Wiltshire
June
HOLDJuly
HOLDThe RBA won't be increasing the cash rate until the unemployment rate is near 5 per cent, which is unfortunately at least a couple of years away.
Mark Brimble
Mark Brimble
June
HOLDJuly
HOLDThe economy will need monetary policy support for a long time to come.
Angela Jackson
Angela Jackson
June
HOLDJuly
HOLDThere is significant uncertainty around the timing of a vaccine for COVID-19 which impacts the point at which the Australian and global economy will start to recover.
Jeffrey Sheen
Jeffrey Sheen
June
HOLDJuly
HOLDConsistent with signalling from RBA
John Rolfe
John Rolfe
June
HOLDJuly
HOLDI do not believe the RBA will entertain a zero or negative cash rate. The banking industry is not in need of lower rates and even if provided, there will not be any rate reduction passed on the customer. There is still QE opportunities to stimulate the market if needed.
John Hewson
John Hewson
June
HOLDJuly
HOLDWorst economic circumstances since Great Depression
Nicholas Gruen
Nicholas Gruen
June
HOLDJuly
HOLDIt will be a long road back, especially as the Government appear to be keen to reduce the extent of the stimulus
Tony Makin
Tony Makin
June
HOLDJuly
HOLDIf the virus is satisfactorily contained, and assuming no second wave, the economy should be recovering by the December quarter. In the context of a domestic and global recovery, the high money growth stemming from public debt monetisation should put upward pressure on the price level, necessitating a monetary policy response. Additionally, the huge issues of government bonds to fund large pandemic- related budget deficits that have not been monetised by central banks here and worldwide would normally put upward pressure on longer term world interest rates.
Noel Whittaker
Noel Whittaker
June
HOLDJuly
HOLDThis is so difficult – there are so many uncertainties. but, of course, if a vaccine is found the economy may boom.
Peter Boehm
Peter Boehm
June
HOLDJuly
HOLDNow is not the time to move interest rates - there's too much economic uncertainty, and clarity around the federal government's existing, and future planned response to COVID-19 is needed before further rate movements should be contemplated.
Nicholas Frappell
Nicholas Frappell
June
HOLDJuly
HOLDThe RBA have indicated that they will keep the rates low for a long period. At the moment its too early to have a view of when the rates will tighten again, although 'sometime' in 2022 would be reasonable...
Malcolm Wood
Malcolm Wood
June
HOLDJuly
HOLDRBA on hold until back close to full employment and underlying inflation sustainably in the 2-3%YoY band
David Robertson
David Robertson
June
HOLDJuly
HOLDThe RBA have very clearly flagged that rates will be on hold at 1/4 % (for both official cash and the 3 year bond) until well into 2022. The next move beyond there should be up when inflation finally rises and labour markets tighten.
Dr Craig Emerson
Dr Craig Emerson
June
HOLDJuly
HOLDThe RBA Governor has publicly stated that the cash rate will remain where it is for a long time.
Rich Harvey
Rich Harvey
June
HOLDJuly
HOLDFar to much volatility and uncertainty to see any moments in interest rates at the moment
We suspect the RBA will come around to our view that inflation will be below the Bank's target for years and therefore launch more stimulus. We expect the RBA to eventually expand quantitative easing with a quantity bond target aimed at the longer-dated end of the yield curve.
Saul Eslake
Saul Eslake
June
HOLDJuly
HOLDCould be that the RBA keeps rates on hold until after Q4 2022
Mathew Tiller
Mathew Tiller
June
HOLDJuly
HOLDIt's unlikely that the RBA will drop rates further and is expected to continue to support the economy via other stimulatory measures until the full impact of the COVID crisis passes.
Stephen Koukoulas
Stephen Koukoulas
June
HOLDJuly
HOLDThe post COVID-19 recovery will be in place and inflation will edge up toward the RBAs target.
John Caelli
John Caelli
June
HOLDJuly
HOLDThe RBA have indicated they will keep rates where they are for a long time.
Mark Crosby
Mark Crosby
June
HOLDJuly
HOLDI don't think that further moves in the cash rate would be effective, and given uncertainty around Covid the timing of future moves is highly uncertain, but doubtful rates will move before 2022.
Julia Newbould
Julia Newbould
June
HOLDJuly
HOLDI think that the Government will need to see what happens when the stimulus payments end and the economy finds its new position.
Susan Mitchell
Susan Mitchell
June
HOLDJuly
HOLD“I expect the cash rate to remain unchanged at the Reserve Bank’s next monetary policy meeting until progress is made towards the RBA’s goal of full employment and the inflation target. The historic low cash rate continues to support an extremely low cost of borrowing and we are seeing a surge in the number of borrowers choosing to refinance and lock in a fixed-interest rate.”
Jason Azzopardi
Jason Azzopardi
June
HOLDJuly
HOLDClear guidance given by RBA the current monetary policy will remain
Christine Williams
Christine Williams
June
HOLDJuly
HOLDUnstable economy at the moment
Besa Deda
Besa Deda
June
HOLDJuly
HOLDThe RBA has provided forward guidance about its use of unconventional policies in several speeches since March. During questions following one of these speeches, Governor Philip Lowe has indicated that the cash rate will not be lifted before the 3-year bond yield target has been lifted. In addition, he said that the bond yield target will not be removed until progress was being made towards the RBA's inflation and unemployment targets. This is estimated to be at least 3 years away.
Mala Raghavan
Mala Raghavan
June
HOLDJuly
HOLDIt is difficult to predict now due to the high uncertainty surrounding the COVID-19 crisis and the subsequent economic crisis. The focus of the policymakers at this stage should be stimulating the economy, but there is not much room in the monetary policy space for that. At this stage, the government's fiscal stimulus is much needed to spur the economy.
Alison Booth
Alison Booth
June
HOLDJuly
HOLDHard to pinpoint when there might be changes, since there's so much uncertainty and the RBA will be making decisions as necessary to keep borrowing costs low and credit available.
Rebecca Cassells
Rebecca Cassells
June
HOLDJuly
HOLDAny decision by the RBA to either increase or lower the cash rate is highly unlikely for some time and we can expect the cash rate to remain exactly where it is now for at least the next two years. The most likely direction the cash rate will head eventually is upwards, but we will need some fairly solid and consistent signs of recovery in the labour market before the RBA starts to consider this change. Towards the fourth quarter of 2021 we should be well on our way to more positive signals here, but much will depend on the level of government support and stimulus committed to jumpstart the economy and our ability to minimise and prevent COVID19 outbreaks. Both are very uncertain right now.
Sarah Hunter
Sarah Hunter
June
HOLDJuly
HOLDThe RBA have made it clear that, for now at least, they don't see negative rates as being necessary or effective. So I think the next move will be up, but it will be quite some time into the future - beyond the end of the forecast horizon in the survey (Q4 2022).
Janu Chan
Janu Chan
June
HOLDJuly
HOLDRba will keep it's accommodative stance for some time while unemployment remains high. Indeed, the risk is towards additional monetary stimulus measures but the rba will look to other measures. The cash rate is as low as it can go.
Cameron Kusher
Cameron Kusher
June
HOLDJuly
HOLDAs much as the RBA is insistent that the current cash rate of 0.25% is their floor, depending on the recovery from COVID-19 it may necessitate taking rates lower. Remember that just last year they were saying they didn't believe in QE's effectiveness. Even if they don't cut interest rates further, a hike in interest rates seems likely to be a long way off.
Steve Miller
Steve Miller
June
HOLDJuly
HOLDThe headwinds to growth are strong and I do not think that inflation will be comfortably within the current 2-2% target range until the end of 2022. I do not think the RBA will lower rates. If they wish to ease further they will employ some other mechanism.
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.
Here's an example of how a change to the cash rate affects a home loan. Let's assume the following:
- The RBA moves the cash rate in increments of 0.25%.
- You have a variable rate home loan and 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
Pre-announcement RBA Press Releases
- RBA survey: Only 35% of experts think now is a good time to buy property
- RBA survey: Two-thirds of experts predict end of stamp duty by 2021
- RBA survey: 87% experts say international borders to remain closed until 2021
- RBA Survey: Experts predict more stimulus and ASX falls
- RBA survey: 87% of experts predict recession
- Masks on, scissors out: RBA cuts cash rate to 0.50%
- RBA Survey: Coronavirus economic impacts just beginning
- RBA Survey: Half of experts think RBA made wrong call with cash rate cuts
Post-announcement RBA Press Releases
- RBA survey: Experts forecast 800+ “zombie” companies to fail in September
- RBA survey: 79% of experts say JobKeeper should continue or expand
- RBA Survey: Brisbane and Melbourne picked as top cities to buy property
- RBA Survey: To buy or not to buy, that is the question
- RBA cuts: Cash rate heading to 0.50%
- RBA Survey: Experts favour Melbourne and Brisbane for property investment
- RBA Survey: Property prices to rise in all capitals as cash rate holds
- Homeowners rejoice, savers brace as RBA cuts to 1.00%
RBA news and announcements
Every lender passing on the RBA’s surprise second March 2020 rate cut
Check if your lender is passing on the cut and offering you a lower variable mortgage rate (and if they're not, here's what you should do). Read more…
What’s really behind the RBA’s emergency mid-month rate cut?
Let's take a closer look at the economic effects of COVID-19, the purpose of the cash rate and the RBA's policy response to the crisis. Read more…
RBA makes unprecedented mid-month rate cut as coronavirus wreaks economic havoc
The official cash rate is now 0.25% after an emergency meeting of the Reserve Bank. Read more…
What an RBA emergency interest rate cut means for stocks
The RBA is pegged to cut rates and introduce quantitative easing – so why is the market crashing? Read more…
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 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
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 forecast right here.
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
Hi Belinda
Appreciate if you would also send me informations regarding findings of monthly RBA survey.
Regards
Eric
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
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
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
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.
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
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
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
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
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