Breaking: RBA cuts interest rates

Interest rates cut by 0.25pc

 

The Reserve Bank of Australia cut the official cash rate by 25 basis points this afternoon, saying inflation has fallen substantially from its peak in 2022 as higher rates have worked to take the steam out of the economy.

 

The central bank forecasts that inflation will be around 2.5 per cent into next year, and that gives it latitude to cut rates. 

 

The RBA warned that the world economic outlook remains uncertain, citing the final scope of US tariffs and policy responses from other countries. This has contributed to a weaker economic outlook for Australia.

 

The bank says risks to inflation are now more balanced, giving little indication of whether there's another rate cut anytime soon.

 

It means mortgage rates will fall - one major bank dropped its standard variable rates within minutes of the announcement - as will deposit rates.

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What the rate cut means for your mortgage

Loan amount	Monthly saving	Annual saving
$600,000	$100	$1,200
$800,000	$128	$1,536
$1,000,000	$161	$1,932
$1,200,000	$193	$2,316

Source: Finder.com.au