RBA Cuts Interest Rates – What It Means for You
On 12 August 2025, the Reserve Bank of Australia (RBA) cut the official cash rate to 3.60% – the third reduction this year. This is the lowest level since March 2023 and signals that monetary policy is shifting to support economic growth amid softer conditions.
The decision was unanimous, with the RBA noting that inflation is now back within its target range of 2–3%, and economic growth remains subdued. Unemployment has ticked up slightly to around 4.3%, while GDP growth in the first quarter was just 0.2%.
What does this mean for Australians?
- Homeowners: A $600,000 mortgage will see repayments fall by around $89 per month, freeing up over $1,000 a year.
- Refinancers: Competition among lenders means refinancing could save households much more. On average, a $600,000 loan could see savings of $272 per month, potentially cutting years off loan terms.
- Home buyers: Lower rates make borrowing more affordable, which may encourage more buyers back into the market – though this could also reignite upward pressure on property prices.
- Investors and markets: The rate cut has weakened the dollar slightly and trimmed bank margins, but many businesses and households will welcome the relief.
What this means for you
Now is the time to review your finances. Whether you’re considering refinancing to save on repayments, looking to invest, or simply want to make sure you’re making the most of lower rates, having a clear strategy could make a big difference.
Simmons Livingstone can guide you through refinancing and investment strategies to take advantage of lower interest rates. Contact us today on 1800 618 800 or via email at admin@simmonslivingstone.com.au.
