RBA calls the June cash rate: Do we care anymore?

RBA keeps cash rate at 4.35% as inflation "too problematic" (honestly, same).

Mortgage holders, rejoice: the RBA has held the cash rate at 4.35%.

If it doesn't feel like much of a celebration to you, you're not alone.

I mean, it's not much of an announcement, and we haven't seen a rate change since November last year.

Despite that, Australians are still finding their mortgage repayments tough going. According to Finder research, 1 in 8 borrowers have missed 1 or more repayments over the last 6 months – and that's why we still care.

The cash rate rose 4.25% over a 19-month period, leaving many borrowers with scary repayment increases. Although it's not rising right now, keeping an eye on the state of things means we can all be better prepared for the future.

"Remind me, why did they increase the cash rate again?"

On paper it all made sense: make people spend more on their loans and they'll spend less elsewhere. That should mean that the cost of all the things we buy goes down, as demand slips.

To be fair, it has mostly worked. Inflation shrunk from 7.8% in December 2022 to where we're at now at 3.6%.

But at what cost? Real people are really struggling. The cost of living and high mortgage repayments is making life hard.

And over the last couple of months inflation has kind of stalled. It hasn't shrunk as much as hoped – this is what has led to some economists questioning if rates will have to rise again.

"Tell me some good news..."

Of course! Well, of the 38 economists Finder surveyed to ask whether they think the next move will be a rise or a cut, only four think a raise is coming in the foreseeable future.

That leaves an overwhelming majority who expect rates to come down... eventually.

Unfortunately, most expect that the first rate cut won't happen until 2025.

But in positive news, around a quarter of our economists predict there will be more than 1 rate cut!

The general consensus is that rates will stay as-is for now, with a rate cut to come in the next 6 to 12 months.

"Following recent higher than expected inflation data the RBA still lacks the confidence to start cutting rates and so will hold for the next few meetings, with the risks still being on the upside for rates," said AMP economist Shane Oliver. "But weaker growth and lower inflation should allow a cut by year end."

Economist Brian Parker from the Australian Retirement Trust also believes there won't be a rate rise: "Inflation still too problematic for a rate cut, while a weak economy makes a tightening highly unlikely."

"What can I do?"

This is all well and good, but if you're struggling with your repayments right now, holding out until 2025 for a rate cut isn't going to make you feel that happy.

If you're at the point of missing repayments, it is imperative that you call your bank and talk to them.

1. Check what other interest rates they're offering and see if you can negotiate a lower rate for yourself.
2. Ask if you can switch to an interest-only plan. You'll only pay the interest, but this does mean you're not paying down your loan.
3. Ask for a hardship plan: banks can pause or reduce your repayments.

Don't forget, you can also talk to the National Debt Helpline on 1800 007 007.

Other things to do:

1. Check out the interest rates at other lenders: depending on your current loan terms and your equity, you may be able to refinance to a lower rate.
2. Cut back in other areas: compare all of your other loans and bills to make sure you're not paying more than you need to.