Cash Rate Decision April 2025: RBA Holds Cash Rate At 4.10%

The Reserve Bank of Australia (RBA) has kept its cash-rate target unchanged at 4.10% during its April 2025 meeting.

Why Did The RBA Hold The Cash Rate In April 2025?

The RBA has kept rates on hold as inflation continues to ease, but the board is taking a cautious approach due to lingering uncertainties in both the domestic and global economy. Since peaking in 2022, inflation has come down, and recent data suggests that this downward trend is continuing. However, the RBA wants to be confident that inflation will return to the 2-3% target band and stay there.

While household incomes are improving and financial stress has slightly eased, many businesses are still facing weak demand, making it hard to raise prices. The labour market also remains tight, even though employment dropped slightly in February, and wage growth has cooled a bit more than expected.

Globally, rising geopolitical tensions and recent US tariffs are adding more uncertainty to the outlook. These developments could affect business and consumer confidence, as well as international trade. The RBA made it clear that it’s prepared to respond if global events begin to affect the Australian economy.

For now, the board sees monetary policy as still restrictive and will continue to rely on incoming data, particularly around inflation, employment, and global risks, before making any future moves.

What Do Our Experts Say About The RBA’s Decision?

Otto Dargan, Founder of Home Loan Experts comments, “This isn’t surprising, the RBA is watching the data carefully and wants to err on the side of caution to make sure that they don’t reignite inflation. They’ll likely monitor the direction of the economy and consider the impact of tariffs from the Trump administration before they make future decisions.”

Adding to this, Home Loan Experts General Manager Bhisan Raj KC says “It was an expected outcome after a rate cut last time. While inflation has been down, it still is not in the bracket the government wants it to be in the long run. Also, they want to be careful not to create any unintended consequences by lowering the rates.”

So, what does it mean for you?

KC says, “I would highly recommend that potential homebuyers get a pre-approval before going to an auction or searching for a property. There has been a slight increase in borrowing power for most lenders after the last rate cut. For existing homeowners, make sure to be in touch with your brokers and do a quick health check of your loan so that you remain competitive. There were a few lenders who did not pass on the rate cut last time so it may be worthwhile to do a check.”

How Does The Cash Rate Affect My Interest Rate?

Lenders add a margin to the official cash rate to determine the variable interest rate they offer to customers.

You can use our repayment calculator to find out what your repayments should look like whenever the cash rate changes.