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Interest rate forecast: when will rates go up in Australia?
The RBA cut the cash rate in August in line with the predictions of the big four banks – economists have now predicted what could happen with rates from here.
12 Aug 2025
The RBA cut the cash rate in August in line with the predictions of the big four banks – economists have now predicted what could happen with rates from here.
In February of this year, the Reserve Bank of Australia (RBA) cut the cash rate for the first time since 2020, and since then, the cash rate has been cut twice more, most recently at on August 12, bringing it to its current level of 3.60%.
This cut was a sign of relief for variable rate mortgage-payers, after a predicted July cut failed to eventuate, but the question now becomes what will happen with interest rates for the rest of the year?
Given that trimmed mean inflation is now officially back in the RBA’s target band for the second consecutive quarter, another rate rise does not appear to be on the horizon, but this doesn’t guarantee that more cuts are going to happen either.
Could we see even more rate movement this year? We’ll find out the RBA’s next move when the board makes its next announcement on Tuesday September 30.
What do the major banks say about future cash rate hikes?
ANZ predicts a 25 basis point cut in November, taking the cash rate to 3.35% by the end of 2025.
CommBank predicts a 25 basis point cut in November, taking the cash rate to 3.35% by the end of 2025.
NAB predicts a 25 basis point cut in November, and another in February, taking the cash rate to 3.10% by the beginning of 2026.
Westpac predicts a 25 basis point cut in November, and another in February, taking the cash rate to 3.10% by the beginning of 2026.
How to ease the pain on your mortgage
There are ways you may be able to pay off your home loan quicker than planned. For example, paying more than the minimum required, or switching from calendar monthly to fortnightly payments can help you reduce the outstanding amount on your loan faster.
You can use our extra repayments calculator to see how that could affect your home loan.
If you’re worried about the impact of any rate rise on your home loan repayments, you might want to consider reviewing your loan. A good place to start is by researching what other rates and loans are on the market, via a comparison website such as Canstar.
Armed with this information, you may choose to discuss with your lender what options may be available, such as fixing all or part of your loan. If you’re in a position to do so, you could also consider asking them for a lower rate, citing examples of other rates on offer.
You may also want to consider switching lenders to take advantage of a more competitive deal, including any refinance offers. But refinancing could involve the payment of fees, so it’s a good idea to read all important documentation, such as the Target Market Determination (TMD) and Key Facts Sheet, before making a decision.
Of course, any rate rise, while bad news for mortgage and other loan customers, would be good news for savers.
Anyone with savings in an interest bearing account will likely be looking for greater return on their money but borrowers will be keen to keep their repayments low, and that’s the challenge the RBA faces every time it meets to consider changing the cash rate.
Owner occupied
20% min deposit
Redraw facility
Owner occupied
10% min deposit
Redraw facility
Owner occupied
20% min deposit
Redraw facility
This article was reviewed by our Editor-in-Chief Nina Rinella before it was updated, as part of our fact-checking process.
Owner occupied
10% min deposit
Redraw facility
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