‘Unanimous’ market stays firm on expected RBA rate hold

Several analyses have confirmed the market’s unanimous verdict that the Reserve Bank of Australia (RBA) will hold the official cash rate at 3.60 per cent in its next monetary policy decision tomorrow.

This month’s Finder RBA Cash Rate Survey was the first this year to result in all 32 expert and economist participants to unanimously agree that the RBA will keep the cash rate steady at its September meeting.

“Mixed economic signals have kept the RBA in a holding pattern. While spending remains strong, rising inflation and increasing unemployment add complexity to the decision-making process,” Graham Cooke, Head of Consumer Research at Finder, said.

“Despite full consensus of a pause, the majority of economists predict a further rate cut by November 2025, as inflationary pressures ease and the economy continues its slow recovery.

“However, September’s increase in monthly inflation from 2.8% to 3% may keep the RBA’s scissors in the sheath on Cup Day if the quarterly data follows suit.”

“The RBA has indicated that it will take a gradual and measured approach to easing interest rates which implies quarterly cuts,” AMP Chief Economist, Shane Oliver, said.

“Since the August meeting nothing has happened to change this. Underlying inflation is around target and economic growth is recovering gradually. So the RBA is likely to hold.”

The Finder research also indicated that just under 70 per cent of participants do expect the RBA to reduce interest rates in November.

This sentiment was echoed by Scott Solomon, Co-Portfolio Manager of the T. Rowe Price Dynamic Global Bond Strategy.

“In-line with market expectations, we expect the RBA to hold the cash rate steady at next week’s meeting. This week’s inflation print exceeded market expectations, but we are mindful the monthly inflation series can be volatile and the RBA places more weight on the quarterly series,” he said.

“Therefore, we are not prepared to abandon our call that the RBA cuts one more time in ’25 to bring the policy rate into neutral territory. This does setup for a pivotal October inflation report as it has potential to have an oversized impact on policy for the next several months – and even into 2026. All told – the RBA’s measured approach and data dependency is paying off.”

Commentary from several HSBC experts – Paul Bloxham, Chief Economist, Australia, NZ & Global Commodities; Lenny Jin, Global FX Strategist; and Justin Heng, APAC Rates Strategist – also confirmed the firm’s view that following a September hold, the November and February 2026 meetings will deliver cuts.

“For the RBA, the economy appears to be in a sweet spot. For the first time in a decade the RBA has inflation comfortably in the target band, while at the same time the unemployment rate has been broadly steady at a ‘full employment’ level and growth is an upswing. This is the trifecta,” the commentary said.

“A quick look over the past decade reminds us of the key challenges. The most recent was the high inflation that came after the pandemic. Prior to that, it was the pandemic itself, which was a very uncomfortable time for policymakers. Before the pandemic, core inflation was persistently stuck below the RBA’s 2-3% inflation target for almost six years. The last extended stretch of persistent ‘on-target’ inflation ended in 2015.

“Given all of this, we think it is highly likely that the RBA cash rate will be left on hold in September. But what will the next move be? And what will the guidance be?

“Our central case sees a cut in November 2025 and another in February 2026. However, with the economy in a sweet spot, as we describe above, there is an increasing risk that the RBA does not cut much further at all.”