CBA has revised its cash rate forecast, delaying the next and what it expects to be the final cut in the cycle to February 2026.
“Inflation came in hotter than expected in August, and the economy is showing signs of a cyclical upswing … We now expect the RBA to stay on hold for the rest of 2025,” CBA’s Belinda Allen said in a media release.
Previously, the bank’s economists predicted a November cut. The revision reflects caution after the RBA’s latest comments.
The move follows NAB’s change last Thursday, with its economists now tipping the next and only remaining cut to arrive in May 2026. Westpac and ANZ continue to forecast a November cut, but both flagged rising uncertainty.
While the outlook for cuts remains cloudy, lending momentum is strong.
Housing loans among all authorised deposit-taking institutions (ADIs) grew by $11.6 billion (0.5%) in August and $131.9 billion (5.9%) year on year, APRA’s August Monthly ADI Statistics showed.
CBA recorded the biggest increase, lifting its residential mortgage book by more than $3 billion (0.5%) in one month and nearly $35 billion (6.2%) over the year.
Macquarie Bank also posted standout growth, adding $2.8 billion (1.9%) in August and $27 billion (21.6%) in 12 months.
“Even without further rate cuts locked in, the home loan market is powering ahead, with data out from APRA showing the residential mortgage market grew by $11.6 billion between July and August among the banks,” said Sally Tindall (pictured), Canstar.com.au data insights director.
Australians continue to build financial buffers despite cost pressures.
Household deposits rose by $9.8 billion in August, pushing the total on ADI books to a record $1.65 trillion. Deposits are now up $139.9 billion (9.3%) year-on-year.
“Household deposits hit yet another record high in August, with Australians stashing away close to $10 billion in just one month,” Tindall said. “It’s remarkable resilience given the cost-of-living crunch and shows many households are still determined to keep building their buffers where they can.”
Tindall added that RBA’s stance matters for both borrowers and savers.
“While borrowers are hoping for more relief, the battle with inflation has not been a straightforward one, which means the cash rate could stay on hold for the rest of this year,” the Canstar leader said.
“Savers will be breathing a sigh of relief at the prospect of the RBA slowing down on rate cuts. With money in the bank continuing to climb, many savers will be glad to see competitive rates hang around for longer.”
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