In a surprise decision, the Reserve Bank of Australia (RBA) kept the cash rate at 3.85% during its July 2025 meeting. Many experts were expecting a rate cut, but the RBA chose to hold off for now.
This move has sparked big reactions across Australia – from homeowners and investors to retirees and politicians. Here’s a simple breakdown of what happened and what it means for your money.
Why Did the RBA Keep Rates on Hold?
According to RBA Governor Michele Bullock, inflation is heading in the right direction – it’s now back in the RBA’s target range of 2–3%. But she warned that they want to see more proof that it will stay low before cutting rates.
Read more on the RBA’s July 2025 decision
Other key reasons:
- The economy is growing slowly.
- Consumer spending is weak.
- New U.S. tariffs are hurting global trade.
For the first time ever, the RBA revealed how its board members voted. Six voted to hold the rate steady, while three pushed for a cut.
What Experts Are Saying
Economists at NAB and Capital Economics still believe a rate cut is likely next month, especially if the June-quarter inflation data (due on July 30) shows further cooling.
Learn why markets still expect an August cut
Market analysts are now watching closely for the next RBA meeting on August 12, 2025.
What This Means for Australians
If You Have a Mortgage
You might have to wait a little longer for relief. But a rate cut could save hundreds or even thousands per year in repayments.
See how a rate cut could impact your home loan
If You’re a Retiree
Lower interest rates can reduce your income from term deposits and savings.
Tips on managing finances in a low-rate environment
If You’re an Investor
A rate cut could mean a rebound in property prices and stock market optimism. But proceed carefully.
Explore expert investment strategies
Political and Public Response
Treasurer Jim Chalmers said the RBA’s decision “surprised markets,” but welcomed the transparency of publishing the vote breakdown.
Opposition Leader Ted O’Brien criticized the RBA for not acting sooner to help struggling households.
Full political reaction to the RBA decision
Meanwhile, RBA Deputy Governor warned that new U.S. tariffs under Trump are a “profound threat” to Australia’s economy.
What Happens Next?
- July 30: June-quarter CPI data released.
- August 12: Next RBA meeting.
- A rate cut is still possible if inflation stays low.
Stay updated on the RBA and how it impacts your lifestyle on EveryAna’s Money & Finance section
