RBA Holds Cash Rate Steady: What It Means for Borrowers Heading Into 2026
The Reserve Bank of Australia has wrapped up 2025 with a widely anticipated decision to keep the official cash rate unchanged at 3.6%. While this wasn't the pre-Christmas rate cut many Australian families were hoping for, the decision provides a measure of certainty as we head into the new year.
No Surprises, But Questions Remain
The decision to hold rates steady came as no surprise to market watchers, with the consensus among economists pointing to a steady hand from the RBA board. The central bank acknowledged that inflation has ticked up slightly in recent months, but attributed this movement to temporary factors rather than underlying economic pressures that would warrant immediate action.
What's most significant is what lies ahead. With the RBA board not scheduled to meet again until February 2026, Australian borrowers have been granted a two-month window of rate stability. This breathing room offers an opportunity to reassess mortgage strategies without the immediate pressure of potential rate movements.
The 2026 Rate Outlook
Commentary has already begun about the RBA's likely path forward. Will 2026 bring the rate relief borrowers have been anticipating, or will the board maintain its cautious stance? The temporary nature of recent inflation upticks suggests the RBA remains open to easing, but the timing remains uncertain.
This uncertainty underscores an important reality for mortgage holders: now is the time for strategic planning, not reactive decision-making.
Fixed vs Variable: The Window Is Open
The gap until February's meeting creates a valuable planning window for homeowners wrestling with the perennial question of whether to fix their mortgage rate or remain on a variable product.
Fixed rates offer certainty and protection against potential rate increases, while variable rates provide flexibility and the ability to benefit from rate cuts if they materialize. With two months before the next RBA decision, borrowers have time to carefully weigh their options based on their individual circumstances and risk tolerance.
Take Action Now
Whether you're looking to secure a mortgage pre-approval for a property purchase, refinance an existing loan to a more competitive rate, or simply review your current mortgage structure, acting now positions you to respond strategically to whatever the RBA decides in 2026.
The stability of the next two months offers a rare opportunity to make proactive financial decisions rather than reactive ones. Our team is ready to help you navigate your options and ensure your mortgage strategy aligns with your financial goals, regardless of what the cash rate does next year.
Don't wait for the next RBA meeting to start planning. Reach out to our team today to explore your options and secure your financial position for the year ahead.