The Reserve Bank of Australia extended the pause in October, leaving the cash rate at 4.10% for the fourth consecutive month.

The RBA’s decision to hold was in line with the forecast from the economists from the big banks.

Here are the highlights of RBA Governor Michele Bullock’s latest monetary policy decision statement:

On the reasons supporting the hold:

  • The RBA Board believes that the higher interest rates are working to establish a more sustainable balance between supply and demand in the economy and will continue to do so.
  • The hold will provide further time to assess the impact of previous rate hikes on the economy.

On inflation and the economy:

  • Inflation remains high but has already passed its peak.
  • Growth in the Australian economy was a little stronger than expected over the first half of the year, but the economy is still experiencing a period of below-trend growth. This is expected to continue for a while.
  • Given that the economy and employment are forecast to grow below trend, the unemployment rate is expected to rise gradually to around 4.5 % late next year.
  • Wages growth has picked up over the past year but is still consistent with the inflation target, provided that productivity growth picks up.
  • Inflation is coming down, the labour market remains strong and the economy is operating at a high level of capacity utilisation, although growth has slowed.

On the RBA Board’s priorities and outlook:

  • The RBA maintains its top priority of returning inflation to target within a reasonable timeframe.
  • Uncertainties remain, including the services price inflation, and the lags in the impact of the monetary policy.
  • The outlook for household consumption also remains uncertain, with many households experiencing a painful squeeze on their finances, while some are benefiting from rising housing prices, substantial savings buffers, and higher interest income.
  • Some further tightening might be needed to ensure that targets are met on time.
  • The RBA Board will keep an eye on the global economy, trends in household spending, and the outlook for inflation and the labour market.

For PropTrack senior economist Eleanor Creagh, there are enough factors to ease the pressure on the RBA to continue lifting rates.

“The full impact of monetary tightening to date is yet to be felt and we’re likely to continue to see inflation moving lower as a result,” she said.

“Unless there is a shift in the disinflationary outlook, it’s likely the peak in the cash rate is already in for this monetary policy tightening cycle.”

Ms Creagh said the decision by the Reserve Bank to continue holding the cash rate steady in October will underpin buyer and seller confidence for the spring selling season.

“Together with a shortage of new home builds, prices are expected to rise, and more markets will likely reach new record levels after recouping last year’s fast falls,” she said.

Latest figures show that dwelling prices remained on an uptrend in October — Ms Creagh said the trend is likely to persist for national home prices.

“One driver of the recovery in home prices this year has been the subdued listings environment, which has seen buyers competing for fewer properties. Home prices have also been underpinned by record levels of net overseas migration, a challenged rental market and an emergent housing shortfall.”

Buying a home or looking to refinance? The table below features home loans with some of the lowest interest rates on the market for owner occupiers.

Update resultsUpdate
LenderHome LoanInterest Rate Comparison Rate* Monthly Repayment Repayment type Rate Type Offset Redraw Ongoing Fees Upfront Fees LVR Lump Sum Repayment Additional Repayments Split Loan Option TagsFeaturesLinkCompare
6.04% p.a.
6.06% p.a.
Principal & Interest
  • Low rates for purchase and refinancing
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  • No fees, unlimited redraws, 0.10% offset 
5.94% p.a.
5.95% p.a.
Principal & Interest
5.95% p.a.
5.95% p.a.
Principal & Interest
5.99% p.a.
5.90% p.a.
Principal & Interest
  • A low-rate variable home loan from a 100% online lender. Backed by the Commonwealth Bank.
Important Information and Comparison Rate Warning

Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. However, the ‘Compare Home Loans’ table allows for calculations to be made on variables as selected and input by the user. Some products will be marked as promoted, featured or sponsored and may appear prominently in the tables regardless of their attributes. All products will list the LVR with the product and rate which are clearly published on the product provider’s website. Monthly repayments, once the base criteria are altered by the user, will be based on the selected products’ advertised rates and determined by the loan amount, repayment type, loan term and LVR as input by the user/you. *The Comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Rates correct as of .


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