RBA interest rates live updates: Homeowners face nervous wait on central bank’s post-call commentary

We’re just 30 minutes away from hearing what the RBA plans to do next.

They’ll be no cut today, but homeowner will want to hear if the RBA agrees with some punters that it could be forced tolift rates next year.

Australian business confidence declined further in November ahead of the Reserve Bank’s final policy meeting of the year.

Confidence dropped 5 points to one point last month, its second-straight fall, a National Australia Bank survey showed today. Conditions, which track sales, profitability and employment, declined by 3 points as weakness in trading and profitability overwhelmed a slight gain in employment.

The report showed capacity utilisation in the economy edged up to 83.6 per cent, the highest level in 18 months.

“The survey continues to tell us that businesses are capacity constrained,” said Sally Auld, chief economist at NAB. “If economic growth accelerates further from the current starting point, we may quickly see additional pressure on prices.”

The reading on corporate Australia arrives just hours before the RBA is anticipated to hold its key rate at 3.6 per cent.

Other key data points:

• The employment index continues to track broadly sideways, consistent with stability in labour market conditions into year-end, the report showed
• Conditions in WA retraced strong gains from October
• Purchase cost growth rose to 1.3 per cent in quarterly equivalent terms

Bloomberg

With no more RBA rate relief expected this year, or next, c Canstar says borrowers should use the time over summer to check whether they can capitalise on the equity in their property to secure a lower rate.

New research from the omparison site shows the majority (62 per cent) of lenders reserve their lowest refinancing rates for owner-occupiers who own at least 30 per cent of their property.

Out of the 10 lowest variable rates, nine require borrowers to own at least 30 per cent and six require at least 40 pe rcent.

The good news is that with the massive rise in property values, many borrowers likely fall into this bucket.

Here’s the best deals on the market right now ...

Looking at CBA’s full-year results, Canstar reckons the average borrower owns more than 58 per cent of their property at today’s values. Similarly, Canstar’s 2025 Consumer Pulse Report found borrowers estimated their home equity at 65 per cent.

“Borrowers with a mortgage should not plan for any further rate relief in 2026, and instead, start preparing for a potential hike, just in case one materialises later next year,” says data insights director, Sally Tindall.

“Take 10 minutes in the lead up to Christmas to check your equity. Work out how much you still owe on your mortgage, minus this from a current estimate of how much your property is worth and there’s your equity.

“Right now, a competitive owner-occupier rate is under 5.25 per cent, while a highly competitive one is under 5.14 per cent. Anything above this should be a cue to shop around.

“Refinancing to a different lender might not be on the agenda for your summer holiday, but the short-term investment could end up paying for your entire summer holiday next year.”

If you put any stock in what the big banks think, here’s what they believe will happen next ...

ANZ is holding on to its prediction that they’ll be another 25 basis-point cut to come in early 2026.

Westpac is more optimistic, tipping two cuts of 25 basis-points - one in May and another to follow in August.

Commonwealth Bank - the nation’s biggest mortgage lender - and NAB reckon the RBA is now done for this cycle.

Punters on the ASX are the biggest bears, pricing in the possibility of a 25 basis-point increase in the official cash rate back to 3.85 per cent by May next year.

There is a reasonable argument that the RBA has cut too far already.

That was the grim warning from HSBC economist Paul Bloxham yesterday ahead of today’s rates decision.

But he warned that reversing course (and lifting rates) would possibly damage the central bank’s credibility.

Could it be worse than when former governor Philip Lowe suggested in late 2020 that the “board is not expecting to increase the cash rate for at least three years”?

Maybe.

Governor Michele Bulloch has won praise for her straight-talking approach since taking the helm so it’s more likely maintaining the strength of the economy will come way ahead of risking bruised egos.

The Aussie share market is trading lower as investors await the Reserve Bank’s final decision on interest rates for the year.

The S&P/ASX200 had dropped 18.2 points just before 1pm AEDT, down 0.2 per cent to 8606.2.

The move tracked a weak session on Wall Street, where there is uncertainty ahead of the US Federal Reserve’s own interest rate decision later in the week.

“While markets remain confident a US rate cut will happen this week, investors are uncertain how deep and sustained easing may be next year,” Moomoo market strategist Jimmy Tran.

“So they’re moving to lock in gains rather than add fresh exposure into year-end.”

On the first day of Christmas, Michele Bullock gave to me ... nothing. Absolutely nothing. Zilch. Squat. Bugger all. To completely plagiarise, then bastardise, the words of Seinfeld’s “Soup Nazi”: No rate cut for you!

And don’t for one second believe they’ll be any festive cheer next year either. The new year could in fact bring (sharp intact of breath everyone) ... rate hikes.

It’s your typical nightmare before Christmas ... just without the warm and fuzzy big-screen happy ending.

It’s a near certainty that the central bank will keep the official cash rate at 3.6 per cent today after the recent inflation surprise — core inflation — which strips out price volatility — hit 3.3 per cent for the year to October.

That’s now back outside the bank’s 2 to 3 per cent sweet spot. Overall, prices were up 3.8 per cent for the year — the worst set of consumer price pressures since June 2024.

So, after three cuts throughout 2025, the official cash rate is expected to remain on hold for much of 2026.

The big question now is what happens next? Some suggest the RBA moved too quickly and too far this year, and that a hike is now a real possibility.

For now, the RBA is likely to tread water and wait and see.

Homeowners will be more interested in what tone the RBA takes in its decision statement, and then what Michele Bullock has to say at her post-call presser.

In the meantime, maybe ease up on the online Christmas shopping. You could need the spare cash next year.

Above-inflation cost rises over the past year may have more seniors hoping to maintain a decent standard of living in retirement thinking about reining in their spending this Christmas.

The Association of Superannuation Funds of Australia’s latest in-depth examination of the price of funding a so-called “comfortable” lifestyle when they retire shows the cost for couples is now $76,505 a year — a new record, and up from $75,319 in the June quarter.

For a single, it’s $54,240, up from $53,289.

For comparison, Centrelink’s full annual rate of the age pension is $46,202 for couples, and $30,646 for singles.

The cost of a comfortable retirement includes the best health insurance you can buy, fast internet and streaming services, an above-average car, regular leisure activities, occasional takeaway and restaurant meals, frequent upgrades to your wardrobe, home repairs or upgrades, annual domestic travel, and splashing out on a big overseas trip every seven years.

READ THE FULL STORY HERE.

Australia’s brutal cost-of-living pressures are tipped to continue until at least 2032 when purchasing power finally gets back to pre-COVID levels.

In a grim forecast, AMP chief economist Shane Oliver said the post-pandemic surge in inflation means it will now take more than a decade for workers to catch up.

“If wages continue to grow at their current pace and inflation stays in the RBA target zone we wouldn’t get back to wages having the same purchasing power in 2020 until 2032,” he said.

This is based on wage growth of about 3.4 per cent and inflation falling back within the Reserve Bank of Australia’s target range of between 2 to 3 per cent inflation growth.

In other words, Dr Oliver says the average 25-year-old worker in 2020 won’t have the same purchasing power until they turn 37.

READ MORE HERE ...