Apply NowFuture Rate
Predictor
Our analysis engine synthesises real-time data from the Reserve Bank of Australia, Australian Bureau of Statistics, APRA and major institutional economists to project the RBA cash rate path with sourced, transparent reasoning.
https://www.fairbanksfinancial.com.au/rate-predictor
RBA Cash Rate — Current
Next Meeting
1 April 2026
Base Forecast
2.85% by May
Cut probability
35% (Apr) · 70% (May)
RBA meeting underway — decision expected today
Macroeconomic conditions broadly support continued gradual easing. Inflation has returned to the RBA's target band and labour market slack is building.
This analysis is informational only and does not constitute financial advice. Past rate movements do not predict future outcomes. Always consult a qualified financial adviser before making decisions.
9 Indicators Driving
the Forecast
Each indicator is weighted by its relevance to RBA monetary policy decisions, sourced from official publications. Green = supports further cuts. Amber = monitor closely. Red = suggests pause or hike.
Trimmed Mean CPI
Target / Range: 2–3%
The RBA's preferred measure of underlying inflation has returned to the 2–3% target band for the first time since Q1 2022, removing the primary impediment to further rate reductions.
ABS Consumer Price Index, Australia, Dec 2025 Quarter
ABS 6401.0
Headline CPI (Annual)
Target / Range: 2–3%
Annual headline inflation has declined sharply from its 2022 peak of 7.8%. The sustained return to target provides the RBA with clear policy flexibility.
ABS Consumer Price Index, Australia, Dec 2025 Quarter
ABS 6401.0
Unemployment Rate
Target / Range: ~4.0% (NAIRU)
The unemployment rate has drifted above the RBA's estimated non-accelerating inflation rate of unemployment (~4.0%), indicating emerging labour market slack. This supports an easing bias.
ABS Labour Force, Australia, Feb 2026
ABS 6202.0
GDP Growth (YoY)
Target / Range: ~2.5% (potential)
Australia's economy is growing below its estimated potential rate of 2.5%, indicating spare capacity in the economy. Per capita GDP remains in contraction, reinforcing the case for stimulus.
ABS Australian National Accounts, Sep 2025 Quarter
ABS 5206.0
Wage Price Index (YoY)
Target / Range: 3.0–3.5%
Wages growth has moderated from its 2024 peak and is now consistent with the RBA's inflation target, reducing concern about a wage-price spiral. Trend is still decelerating.
ABS Wage Price Index, Australia, Dec 2025 Quarter
ABS 6345.0
Policy vs Neutral Rate
Target / Range: 3.0–3.5% (neutral)
The RBA estimates its neutral (r*) cash rate at 3.0–3.5%. At 3.10%, current policy is near neutral but still slightly restrictive. This supports at least one additional cut to move toward a neutral-to-accommodative stance.
RBA Statement on Monetary Policy, Feb 2026; RBA Bulletin — Estimating the Neutral Rate
RBA SMP Feb 2026
Housing Credit Growth
Target / Range: Watch: >6% raises concerns
Housing credit is re-accelerating as rate cuts flow through. This is the primary constraint on aggressive easing — the RBA has flagged housing market dynamics as a key consideration for the pace and depth of the cutting cycle.
APRA Monthly Authorised Deposit-taking Institution Statistics, Jan 2026
APRA MADIS Jan 2026
Consumer Sentiment Index
Target / Range: >100 = optimistic
Consumer confidence remains below the neutral 100 level, reflecting cautious household spending despite recent rate relief. Persistent pessimism supports the need for continued policy support.
Westpac-Melbourne Institute Consumer Sentiment, Feb 2026
Westpac-MI CSI Feb 2026
US Federal Funds Rate
Target / Range: Easing cycle underway
The US Federal Reserve is mid-easing cycle, having cut rates from the 2023 peak. This reduces the risk of excessive AUD depreciation from RBA cuts, giving the RBA more room to ease without currency concerns.
US Federal Reserve FOMC Statement, March 2026
FOMC Mar 2026
Three Scenarios — One
Probability-Weighted Forecast
Rather than a single prediction, we present probability-weighted scenarios derived from current macroeconomic data and RBA communications. Scenarios are updated as new official data is released.
RBA Cash Rate — Historical & Projected (2022–2026)
Sources: RBA, ABS, Bloomberg. Projections represent probability-weighted scenarios, not guaranteed outcomes.
Pause & Hold
20%
probability
Target Rate by Dec 2026
3.10%
Hold at 3.10% through H2 2026
Required Conditions
- Housing prices re-accelerate above 8% YoY
- Services inflation proves sticky above 4%
- Labour market tightens unexpectedly
- Global commodity price shock re-ignites CPI
RBA pauses to assess cumulative impact of prior cuts and re-evaluates housing risk.
One More Cut
55%
probability
Target Rate by Dec 2026
2.85%
-25bp in May → hold through year-end
Required Conditions
- Trimmed mean CPI stays within 2–3% band
- Unemployment drifts to 4.3–4.5%
- GDP growth remains below 2.5% potential
- Housing credit growth stays under 6%
RBA cuts once in May to approach neutral, then pauses to monitor transmission and housing.
Two More Cuts
25%
probability
Target Rate by Dec 2026
2.60%
-25bp in May + -25bp in July
Required Conditions
- CPI undershoots to 2.0–2.3% by mid-year
- Unemployment rises above 4.5%
- Global growth weakens materially
- Household consumption fails to recover
RBA moves to mildly accommodative stance to support growth and provide insurance against deflation risk.
Upcoming RBA Board Meetings
1 April 2026
11 days away
Q4 2025 CPI confirmation and Feb labour force data
0.14 cuts priced (ASX 30-day)
20 May 2026
60 days away
Q1 2026 CPI + updated RBA forecasts in SMP
0.82 cuts priced (ASX 30-day)
8 July 2026
109 days away
Post-May assessment — labour market and housing response to easing
1.1 total cuts priced to July
11 August 2026
143 days away
Q2 2026 CPI — test whether cuts have re-ignited inflation
1.25 total cuts priced to August
What this means for your mortgage
Enter your loan details to see exactly how each projected RBA cut translates into real monthly savings. Based on the current average variable rate of 5.20% (3.10% cash rate + 2.10% avg lender margin).
Current rate
5.20%
New rate
4.95%
Monthly saving
$1,140 saved per year
Current monthly repayment
$3,876
After 1 cut
$3,781
1-year saving
$1,140
3-year saving
$3,421
5-year saving
$5,702
Cumulative estimates assume the rate cut is passed on in full immediately and repayments adjust. Actual savings vary by lender and loan structure.
Want to make sure your lender actually passes on the rate cut? A mortgage health check takes 10 minutes.
Calculator assumptions: Calculations use a principal & interest repayment model. The lender margin of 2.10% represents the average standard variable rate premium above the RBA cash rate based on APRA ADI data (March 2026). Individual lender margins vary. Not all lenders pass on rate changes in full or on the same timeline. This calculator is illustrative only and does not constitute financial advice. RBA Statistics Tables · APRA ADI Statistics
What the Major Banks
Are Forecasting
Forecasts from Australia's major banks and institutional analysts. Where there is strong agreement, confidence in the forecast increases. Divergence signals genuine uncertainty. All sourced directly from published research.
Consensus End-2026 Rate
2.85%
Median of 6 institutions
Implied Total Cuts
1x 25bp
From current 3.10%
Consensus Next Cut
May 2026
70% probability priced
Range of Forecasts
2.60%–3.10%
Bull to bear spread
Commonwealth Bank
Expects inflation to undershoot, providing room for 2 additional cuts. Most dovish of the Big 4.
Westpac
One cut in May then a prolonged pause as the RBA monitors housing market reaction.
NAB
Aligns with base case — one cut in May. Notes housing as key upside risk to rates.
ANZ
Sees policy moving to neutral by mid-year. Risk skewed to fewer cuts if housing accelerates.
AMP Capital
Expects weak per-capita growth to force the RBA's hand — 2 cuts the most likely outcome.
Bloomberg Consensus
ConsensusMedian of 24 surveyed economists. Strong consensus around one May cut then a hold.
Market-Implied Pricing (ASX Futures)
Next Cut Expected
May 2026 (70% probability)
Total Cuts by Dec 2026
1.2 cuts (44bp) by December 2026
Terminal Rate Range
2.85% median (range: 2.60%–3.10%)
Source: ASX 30-Day Interbank Cash Rate Futures, March 2026
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How This Forecast Is Built
Data Collection
We compile primary-source macroeconomic data from the RBA, ABS and APRA on a rolling basis. All data is dated and sourced. No secondary interpretation is used — only published official figures.
Indicator Weighting
Each indicator is assigned a weight reflecting how explicitly the RBA has cited it in its public communications (Statements, Minutes, Bulletin). Trimmed mean CPI and the neutral rate carry the highest weights, consistent with the RBA's dual mandate (price stability + full employment).
Scenario Construction
We construct three scenarios (bear/base/bull) based on plausible combinations of future data outcomes. Probabilities are assigned based on current conditions, market pricing and directional alignment of indicators. Scenarios are reviewed when new official data is released.
Institutional Cross-Reference
Forecasts from ANZ, CBA, NAB, Westpac, AMP Capital and the Bloomberg consensus are compared against our scenarios. Where strong alignment exists, scenario confidence increases. Divergence narrows confidence bands.
Limitations
This tool does not account for unexpected events (e.g., geopolitical shocks, pandemic-scale disruptions) or intra-quarter data releases not yet published. The RBA is an independent body — its decisions can deviate from consensus. This is not a financial services product.
Complete Source List
Reserve Bank of Australia
- ·Statement on Monetary Policy (Feb 2026)
- ·RBA Board Meeting Minutes
- ·RBA Bulletin — Estimating the Neutral Rate of Interest
- ·RBA Cash Rate Target Decisions
Australian Bureau of Statistics (ABS)
- ·6401.0 — Consumer Price Index, Australia (Dec 2025 Quarter)
- ·6202.0 — Labour Force, Australia (Feb 2026)
- ·5206.0 — Australian National Accounts: National Income, Expenditure & Product (Sep 2025)
- ·6345.0 — Wage Price Index, Australia (Dec 2025 Quarter)
Australian Prudential Regulation Authority (APRA)
- ·Monthly Authorised Deposit-taking Institution Statistics (Jan 2026)
- ·Quarterly ADI Property Exposures Statistics
Institutional Research (Published Public Reports)
- ·CBA Global Economics: Australian Rate Outlook, Mar 2026
- ·Westpac Economics: Market Outlook, Feb 2026
- ·NAB Markets Research: Australian Economics, Mar 2026
- ·ANZ Research: Australian Rates View, Mar 2026
- ·AMP Capital Economics: RBA Rate Forecast, Feb 2026
Market Pricing
- ·ASX 30-Day Interbank Cash Rate Futures (March 2026)
- ·Bloomberg Economist Survey — Australian Cash Rate (Mar 2026)
US Federal Reserve
- ·FOMC Statement and Press Conference (March 2026)
- ·Federal Reserve Economic Data (FRED) — US Federal Funds Rate
Important Disclaimer
This Future Rate Predictor is provided by Consolidated Funding Group Pty Ltd trading as Fairbanks Financial Group for informational and educational purposes only. It does not constitute financial advice, investment advice, or a recommendation to take any action with respect to a financial product.
The forecasts, scenarios and analysis presented on this page are based on publicly available data and institutional research. They represent Fairbanks Financial Group's interpretation of available information at the time of publication and are subject to change without notice as new data becomes available.
Interest rate forecasting is inherently uncertain. Past RBA decisions and rate movements are not indicative of future outcomes. The actual cash rate may differ materially from any scenario presented here due to unforeseen events, RBA Board discretion, and changes in domestic or global economic conditions.
Consolidated Funding Group Pty Ltd trading as Fairbanks Financial Group holds Australian Credit Representative (ACR) No. 481272. This tool is not a financial services product and is not regulated by ASIC as such. If you require personalised financial advice, you should consult a licensed financial adviser.
Data last reviewed: March 2026. Next scheduled review: April 2026 (following RBA April Board meeting and Q1 2026 CPI release).