Big four banks back interest rate cut prediction this week
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Australia’s big four banks Westpac, ANZ, CBA and NAB are aligned in expecting no change to interest rates at the Reserve Bank of Australia’s meeting this week.
The RBA board meets over the next two days, with all four banks forecasting the cash rate will remain at 4.35%, a level held for an extended period as the central bank continues its fight against inflation.
This pause would follow a series of earlier rate hikes aimed at bringing inflation under control.
Canstar.com.au insights director Sally Tindall said markets are now largely confident the RBA will keep rates steady, with attention shifting to when cuts might eventually begin.
ANZ has recently revised its outlook, now expecting two rate cuts of 0.25% in 2027, bringing the cash rate down to 3.85%. That marks a shift from its earlier view that rates would stay unchanged for longer.
Westpac takes a more cautious stance, forecasting possible rate increases later this year before any cuts are considered in 2028.
For mortgage holders, the difference in outlook matters. A 0.25% rise in August could add about $92 a month in repayments on a $600,000 loan over 25 years. Further increases would push total monthly costs up by roughly $364 across 2026 so far.
Despite some agreement on eventual rate cuts, economists remain split on timing, highlighting ongoing uncertainty in the economy. Inflation is still above target, and global risks continue to weigh on the outlook, keeping the RBA in a watchful position.
Source : 9 News
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