RBA Rate Updates
Australia’s Current Interest Rate is 1.25%
The board of Australia’s government-owned central bank, the Reserve Bank of Australia (RBA) sets the Australian official cash interest rate (OCR) on the first Tuesday of each month, except January.
InfoChoice tracks the RBA’s rate changes, reports changes within minutes of the RBA making an announcement and gives you the information you need to find the best mortgage and savings rates in Australia for your own circumstances.
Currently, the RBA has the Australian Official Cash Rate set at 1.25 per cent, a historically low level. The RBA cut the cash rate on 4 June 2019 after almost three years of keeping rates steady at 1.50 per cent.
The RBA Board said they cut rates in June 2019 to support employment and demand in the economy. The board noted that property prices have been falling but the rate of price decline has slowed in the first half of 2019.
What is the RBA’s official cash interest rate?
The OCR effectively sets the wholesale price of lending in Australia. When the RBA changes this rate, the banks and other lenders follow by changing their retail variable lending and savings interest rates. If the RBA puts the OCR up, your variable home loan and savings accounts rates will probably also rise. A cut in the OCR means your loan and account rates may also be cut.
The lowest variable rate home loans available in Australia are priced about two per cent above the RBA’s OCR. The lowest variable rate mortgages on offer from the big four banks start from about three per cent above the OCR.
The highest savings account rates in Australia are about one per cent over the OCR.
Fixed rate home loan rates and term deposit rates are not based on the RBA’s OCR and do not follow movements in the official cash rate.
The RBA operates independently of government and is charged with maintaining low unemployment and low inflation. When inflation falls or unemployment rises, the RBA may consider cutting rates. When unemployment falls, or inflation rises sharply, the RBA may consider raising rates.
Last Meeting: 4 June 2019
Next Meeting: 2 July 2019