RBA REDUCES CASH RATE TO 3.85%
In a move that came as no surprise to most, the Reserve Bank of Australia (RBA) has just lowered the official interest rate by 25 basis points, bringing it down to 3.85%. This follows today’s monetary policy meeting and reflects the latest economic data showing inflation is finally easing.
According to the Australian Bureau of Statistics, annual trimmed mean inflation—the RBA’s go-to measure—has dipped into the target range of 2–3%, falling from 3.3% to 2.9% in the March 2025 quarter. That drop gave the RBA the confidence to take action.
So, what’s next? Economists are predicting we could see more rate cuts over the course of 2025, but that all hinges on how inflation, employment, and overall economic trends unfold.
And here’s where it gets interesting for borrowers: banks and lenders typically follow the RBA’s lead. That means we can expect to see reductions in variable interest rates coming soon—potentially putting a little extra breathing room into household budgets.