Hoping for an interest rate cut? Here’s when it may happen

0 4 2 minutes read

This week the Reserve Bank of Australia’s board will meet to set the cash rate target for the first time since the federal election.

These meetings can have a direct impact on the weekly budgets of people across the country.

So here’s what you need to know about the next RBA meeting.

When does the RBA meet next?

Monday and Tuesday.

But we won’t hear about the board’s decision on rates until 2:30pm AEST on Tuesday.

The ABC team will be live blogging the RBA announcement right here on our website.

Ahead of most RBA meetings, Google Trends data shows in increase in searches for the question “when will interest rates go down?”.

But this time, all people want to know is when the RBA will meet next.

That could suggest people see the likelihood of a cut as near-certain — and that they’re counting down the days until it comes through.

Currently, the cash rate target is 4.1 per cent.

The cash rate is the interest rate set by the RBA, which influences how much commercial banks charge customers for borrowing money.

But when the RBA changes the cash rate target, interest rates for mortgages don’t automatically change — the individual banks decide that.

Economists and banks are expecting the board to cut rates this week.

Here’s what the major banks say:

If the RBA does cut rates, it’ll be up to the banks to decide if they’ll pass that cut on to customers.

So if you have a mortgage, you’ll have to wait to hear from your lending institution about whether your rates are changing.

When rates were cut earlier this year, each of the big four banks reflected the change within a few minutes.

This time around, some lenders have already begun lowering rates, as banks have a high degree of confidence the RBA will make a cut.

We can’t say for sure, but many economists reckon there will be.

Here’s how many more cuts major banks are forecasting for this year:

ANZ: Predicts two more rate cuts in July and August, by which time the cash rate would be 3.35 per cent.
Commonwealth Bank: Predicts rate cuts in August and November, taking the cash rate to 3.35 per cent by the end of the year.
NAB: Predicts three more cuts of 0.25 percentage points each by the end of the year, then another in February 2026.
Westpac: Predicts two more cuts of 0.25 percentage points in the second half of the year.