Homeowners are hopeful that 2025 might bring them good fortune, as numerous forecasts suggest a series of consecutive interest rate reductions.
Many will be taking comfort in the fact that the nation’s big four banks are predicting several rate cuts for the rest of the year.
The cuts come as the Reserve Bank of Australia shifts its focus from reducing inflationary pressures to measures designed for economic growth.
When does the RBA meet next?
The RBA has listed the following meeting dates on its website:
July 7 and 8
August 11 and 12
September 29 and 30
November 3 and 4
December 8 and 9
However, the RBA told reporters late last year that some of those meeting dates may shift.
That may include the November meeting, so it doesn’t clash with Melbourne Cup Day on November 4.
When will an outcome be announced?
The outcome of the respective meetings will be announced at 2.30pm on the second day scheduled, and the Governor will hold a media conference at 3.30pm.
The minutes of the monetary policy meeting will continue to be published two weeks after each meeting.
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RBA board chair Michele Bullock during a press conference. Picture: NewsWire / Nikki Short
What is the cash rate target?
The RBA has set the cash rate target at 3.85 per cent as of May 21, 2025.
This rate was lowered from 4.10 per cent by 25 basis points at the May 20, 2025 meeting. The next update for the cash rate target is scheduled for 2.30 pm on July 8, 2025.
When will be the next rate cut?
Mortgage holders could be waiting until September to see a reduction in their home loan repayment rates as some economists predict the RBA will not make a further cuts at its July and August meetings.
RBA governor Michele Bullock said the board had considered a 0.50 per cent cut during its May meeting, before reaching consensus on the 0.25 per cent reduction to the cash rate target.
“Does it mean we’re headed into a long series of interest rate cuts? I don’t know at this point,” she told media.
She described the 0.25 per cent cut as “cautious”, adding that it came “with a recognition that if we need to move quickly, we can. We have got space.”
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Australia’s Big Four banks have also shared their predictions.
CBA predicts a cut each quarter in 2025, taking the cash rate to 3.35 per cent by the end of the year.
Westpac predicts further cuts in August, and November, taking the cash rate to 2.25 per cent by the end of the year.
ANZ predicts two more cuts, taking the cash rate to 3.35 per cent by August, while National Australia Bank expects that rates will ease more quickly through the middle of this year, taking the cash rate to 2.6 per cent by 2026.
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Australia’s four big banks all predict further rate cuts in 2025.
When will interest rates go down?
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.
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