RBA holds cash rate – what do economists predict is next?
Low mortgage rates continue to be the norm and property prices are breaking all kinds of records.
Read more…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.
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- 100% of our experts correctly predicted the RBA would hold the cash rate at its meeting on 02 March 2021
- The official cash rate remains at the historic low of 0.10%
Next rate meeting: The board of the Reserve Bank meets on 06 April 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.
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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 March 2021 cash rate decision.
Shane Oliver
Shane Oliver
February
HOLDMarch
HOLDWhile the economy has recovered faster than expected, the RBA is still a long way away from meeting its inflation and employment goals so a rate hike is still a long way away. That said the faster than expected recovery will likely see the first hike occur earlier than the RBA's expectation of no hike before 2024. It could come late next year or early 2023.
Leanne Pilkington
Leanne Pilkington
February
HOLDMarch
HOLDThe economy appears to be recovering faster than expected but the RBA has doubled down on its view that rates will remain low for some time to come. This stated unwillingness to tinker with rates will provide confidence to home buyers and continue to support rising property prices in the near term.
Geoffrey Kingston
Geoffrey Kingston
February
HOLDMarch
HOLDInflation is likely to pick up sooner than the official family thinks.
Michael Yardney
Michael Yardney
February
HOLDMarch
HOLDThe RBA will wait for unemployment to fall wages to rise and inflation to fall within its desired range before it raises rates
Nicholas Gruen
Nicholas Gruen
February
HOLDMarch
HOLDIt will be a long time before we raise rates
Saul Eslake
Saul Eslake
February
HOLDMarch
HOLDBecause they have said so explicitly (“2024 at the earliest”) although I am surprised they haven’t left themselves some “wriggle room” for the (non-trivial, as I would see it) possibility that the unemployment rate falls to less than 5% before then
Noel Whittaker
Noel Whittaker
February
HOLDMarch
HOLDI am sure they won't go up – and doubt they will take them down any more at this stage
Peter Boehm
Peter Boehm
February
HOLDMarch
HOLDThe RBA has strongly indicated that interest rates will remain at their current levels for the foreseeable future and there has been no economic data to suggest otherwise. We’ll need to see the impact of the end of Jobkeeper in March, but if the economic recovery continues on it current recovery trajectory, it is highly likely we’ll see interest rates begin to rise early next year.
David Robertson
David Robertson
February
HOLDMarch
HOLDThe official cash rate should start to rise by 2023. The welcome recovery for jobs is evidence that monetary policy has combined effectively with fiscal and health policies, so assuming the vaccine rollout goes smoothly, this recovery can build pace through 2021.
Tony Makin
Tony Makin
February
HOLDMarch
HOLDGlobal economic activity will pick up as countries are vaccinated. Given the expansion in money supplies other things equal this will put upward pressure on inflation. Otherwise macroeconomics textbooks need to be rewritten. At the same time record breaking levels of public debt worldwide will continue to exert upward pressure on bond yields.
Dr Craig Emerson
Dr Craig Emerson
February
HOLDMarch
HOLDThe RBA has indicated it won't change the cash rate until inflation is well into the 2-3% range and unemployment is low.
Rich Harvey
Rich Harvey
February
HOLDMarch
HOLDRBA have said Rates on on HOLD for next 3 years!
Christine Williams
Christine Williams
February
HOLDMarch
HOLDglobal money is at an all time low
Ben Udy
Ben Udy
February
HOLDMarch
HOLDWhile we are upbeat about the economic outlook the RBA has announced it will extend its asset purchases when they end in April and we think they will extend again through to the end of 2021.
Mathew Tiller
Mathew Tiller
February
HOLDMarch
HOLDRecent statements by the RBA suggest that they will continue to hold rates at their current level until the economy strengthens.
Julia Newbould
Julia Newbould
February
HOLDMarch
HOLDThe RBA has already indicated that it is unlikely to lift rates before the end of the year.
Susan Mitchell
Susan Mitchell
February
HOLDMarch
HOLDI expect the RBA to continue to hold the cash rate. Economic indicators reveal a strong bounce back in the domestic economy. The housing market is booming, fuelled by an extremely low interest rate environment and fiscal stimulus. Unemployment has recovered from its Pandemic peak and consumers are confident. The rollout of the COVID-19 vaccine will bolster consumer confidence in the months ahead. All these factors would encourage RBA Board members to maintain the cash rate at its record low for the foreseeable future.
Jason Azzopardi
Jason Azzopardi
February
HOLDMarch
HOLDI believe a period of stable interest rates is required to provide confidence and stimulate growth
Cameron Kusher
Cameron Kusher
February
HOLDMarch
HOLDBased on the RBAs guidance I see no reason why they would change direction and cut rates and no sign they will lift rates any time soon.
Jonathan Chancellor
Jonathan Chancellor
February
HOLDMarch
HOLDThere will be bumps in the economic recovery that will prompt the central bank to keep rates on hold for the next two years as they watch for inflationary pressures.
Dr Andrew Wilson
Dr Andrew Wilson
February
HOLDMarch
HOLDAlthough it is unlikely the RBA will increase rates until the jobless rate falls below 5%, it may be prudent to at least consider a tightening policy prior to achieving that rate to provide capacity for traditional monetary policy initiatives.
Jeffrey Sheen
Jeffrey Sheen
February
HOLDMarch
HOLD
Matthew Peter
Matthew Peter
February
HOLDMarch
HOLDAlthough the labour market is improving and global commodity prices are lifting headline inflation, full employment remains a long way off. Until then, wage growth will remain tepid and underlying inflation will be weak. The RBA will keep rates at 0.1% until the unemployment rate gets to 5%, which is at least two years away.
Sean Langcake
Sean Langcake
February
HOLDMarch
HOLDThe RBA have been explicit that they don't expect to raise the cash rate until 2024. Their hand may be forced a little sooner than that, but the first rate hike is still a couple of years away.
Dale Gillham
Dale Gillham
February
HOLDMarch
HOLDWhilst the vaccine roll out is now underway, I think our economic recovery will be slow as many industries will not get back to full speed for quite some time.
Stephen Koukoulas
Stephen Koukoulas
February
HOLDMarch
HOLDInflation
Michael Witts
Michael Witts
February
HOLDMarch
HOLDThe pace of the recovery appears to be quickening such that the pre conditions set by the RBA for a rate increase may occur earlier than their 3 year horizon.
Mark Crosby
Mark Crosby
February
HOLDMarch
HOLDRBA has now clearly flagged no rate increases this year or next. Despite the debate over expansion of QE the RBA is rightly resisting, given the limited impact of further QE and already existing distortions.
Alex Joiner
Alex Joiner
February
HOLDMarch
HOLDThe RBA has absolutely no justification based on the current economic environment to wind back any of its stimulus measures. I don't expect it will contemplate such moves until the unemployment rate is at or below 5%
John Hewson
John Hewson
February
HOLDMarch
HOLDUncertain recovery
Mark Brimble
Mark Brimble
February
HOLDMarch
HOLDAnother 12 months plus of stimulus/monetary policy support is likely to be needed. All going well with the vaccine, global macros and confidence, the second half of next year may see the winding down of this.
Nicholas Frappell
Nicholas Frappell
February
HOLDMarch
HOLD2021 looks likely to see a reflation move that sees the end of RBA yield curve management and sets the stage for a review of the existing ultra-low rate environment.
Rebecca Cassells
Rebecca Cassells
February
HOLDMarch
HOLDThere’s an increasing prospect of interest rates being lifted earlier than the 2024 timeline that the RBA has offered up in recent statements. This could be as early as the second half of 2022 if the labour market continues to respond and prices continue to push upwards - particularly through the housing market. Whether this activity will be enough to reach the 2% inflation threshold will remain to be seen, but it’s certainly more likely now than it was a month ago.
Brian Parker
Brian Parker
February
N/AMarch
HOLDBecause it will take considerable time for wage and price inflation to be high enough for the RBA to raise rates.
Stephen Halmarick
Stephen Halmarick
February
N/AMarch
HOLDThe RBA forward guidance is clear that the cash rate will not be increased until actual (not forecast) inflation is sustainable within the 2%-3% target range - which they put at 2024.
Sveta Angelopoulos
Sveta Angelopoulos
February
N/AMarch
HOLDIts unlikely that the economy will experience excessive inflationary pressures for some time given the existing conditions.
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
Pre-announcement RBA Press Releases
- Finder RBA Cash Rate Survey: Experts predict 12% rise in property prices by 2023
- Finder’s RBA Cash Rate Survey: Record refinancing to continue, house prices to jump
- Finder’s RBA cash rate survey: 89% of experts support axing stamp duty nationally
- Finder’s RBA cash rate survey: 67% of experts predict November cut
- 40% of experts predict cut by November, Finder survey
- 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
Post-announcement RBA Press Releases
- Finder’s RBA Cash Rate Survey: Positivity around employment at record high, housing affordability nosedives
- Finder’s RBA cash rate survey: Experts reveal their top economic predictions for 2021
- Finder’s RBA survey: Cash rate cut, Melbourne and Sydney overvalued
- Finder Cash Rate Survey: RBA holds rate at 0.25%, November cut expected
- RBA survey: Experts say Australian economy is yet to “turn a corner”
- 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 news and announcements
RBA holds the cash rate: Why that means low interest rates and higher house prices
When mortgage rates stay low, it's cheaper to borrow money - but that's not all good.
Read more…
16 predictions for Australia’s economy, housing market and borders in 2021
We surveyed 40 economists and 1,000 members of the public on what they thought was in store for the economy in 2021.
Read more…
RBA holds cash rate, but you can still save thousands on your home loan
Mortgage rates are now under 2%, but you probably won't find the cheapest deal with your current loan or lender.
Read more…
RBA rate cut: which lenders are passing on the cut?
The official cash rate is now 0.10%. Here are all the lenders passing on the RBA's November cut to borrowers.
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.
-
What does an interest rate rise mean for you?
Find out how to respond to news of an RBA cash rate rise.
-
RBA cash rate decrease
RBA cash rate drops can see you pay less on your home loan. Find out how to best make use of a cut to the official cash rate.
-
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 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 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
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.
The best time to sell your property relies on plenty of other factors that you need to consider before selling your house. Our guide to find out when really is the best time of year to sell your house might be handy for you.
You can also refer to a guide on everything you need to know before you sell your house on this page. You can also speak to a real estate agent for assistance.
I hope this helps.
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 have emailed you with some information regarding the findings from our monthly RBA survey.
You may also sign up for RBA cash rate forecast and 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.
While we are not in a position to forecast interest rates, you can sign up to receive our RBA cash rate updates which you might find useful.
Thanks,
Belinda