RBA Cash Rate in Australia
Australia's central bank maintained relatively low policy rates from 2013 to 2022, reflecting a stable economic environment. Rates were cut several times to historic lows, particularly during the COVID-19 pandemic, to support economic growth and mitigate the pandemic's impact. By 2022, as the economy recovered, rates began to be normalized, but the overall approach remained cautious, balancing economic recovery with potential inflationary pressures.
The RBA Cash Rate ended 2022 at 3.1%, up from the 0.1% end-2021 value and up from the reading of 2.5% a decade earlier. For reference, the average policy rate in the Asia-Pacific region was 3.7% at the end of 2022. For more interest rate information, visit our dedicated page.
Australia Interest Rate Chart
Australia Interest Rate Data
2018 | 2019 | 2020 | 2021 | 2022 | |
---|---|---|---|---|---|
RBA Cash Rate (%, eop) | 1.50 | 0.75 | 0.10 | 0.10 | 3.10 |
90-Day Bank Bill (%, eop) | 2.02 | 0.90 | 0.02 | 0.06 | 3.17 |
10-Year Bond Yield (%, eop) | 2.32 | 1.36 | 0.97 | 1.67 | 4.03 |
RBA stands pat in February
At its monetary policy meeting on 6 February, the Reserve Bank of Australia (RBA) left the official cash rate (OCR) unchanged at 4.35%. The decision marked the second consecutive hold.
The Bank decided to leave the monetary policy stance unchanged as it assessed that, even if inflation is moderating, it remains elevated. In its updated forecasts, the Bank now expects inflation to hit the midpoint of its 2.0–3.0% inflation target range only in 2026.
The Bank reiterated that it “remains resolute in its determination to return inflation to target and will do what is necessary”. The path of future monetary policy will depend on data and the evolving outlooks for inflation, domestic demand, the labor market and the global economy. Our panelists expect the RBA to start easing its policy stance this year as inflation moderates. The next monetary policy meeting is scheduled for 18–19 March.
Commenting on the outlook, UOB’s Lee Sue Ann stated: “We think that the Q4 2023 CPI data overall provides some breathing room and thus will not push the RBA in the same manner as in November 2023. For now, we see the current cash rate of 4.35% to be the peak. We also see the data-dependent RBA holding off policy easing until later in the year.”
How should you choose a forecaster if some are too optimistic while others are too pessimistic? FocusEconomics collects Australian interest rate projections for the next ten years from a panel of 20 analysts at the leading national, regional and global forecast institutions. These projections are then validated by our in-house team of economists and data analysts and averaged to provide one Consensus Forecast you can rely on for each indicator. By averaging all forecasts, upside and downside forecasting errors tend to cancel each other out, leading to the most reliable interest rate forecast available for Australian interest rate.
Download one of our sample reports to visualize what a Consensus Forecast is and see our Australian interest rate projections.
Want to get access to the full dataset of Australian interest rate forecasts? Send an email to info@focus-economics.com.
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