Rates to be on hold in June?

The RBA’s Monetary Policy Board meets next Tuesday to make their fourth decision of the year, with the cash rate currently sitting at 4.35%.

In the space of a few months, the rate has climbed three times and undone the rate cuts borrowers saw last year.

So where does the June call land? The short answer from the market is a pause. But the longer story is more interesting, and it matters for what you do next.

Key takeaways

• • The RBA has lifted the cash rate three times in 2026, taking it to 35% in May.
  • Headline inflation eased to 2% in the year to April, down from 4.6% in March, but underlying inflation nudged up to 3.4%.
  • The housing market has cooled, with national values flat in May and Sydney and Melbourne both falling.
  • For borrowers, this is the moment to review your loan.

The inflation picture is mixed, and that’s the problem

Inflation will be a critical consideration for the RBA. Here’s where it gets tricky: On the surface, the April inflation figures looked like a turning point. The most recent read from the Australian Bureau of Statistics, released on 28 May, put annual CPI at 4.2% in the year to April, down from 4.6% in March. On the surface, that is a step in the right direction.

It is worth knowing why it fell. On the latest Property Insights monthly economic update, economist Stephen Koukoulas made the point that the headline number is flattered by one temporary factor: the cut to the fuel excise.

“Almost all of the drop in the annual rate, from 4.6%, came from the petrol excise cut,” said Koukoulas.

That matters because the excise cut ends on 1 July. In fact, petrol is still sitting 23.5% above where it was in February, before the Middle East conflict pushed oil prices up.3 Look past the volatile items and the picture is stickier. The trimmed mean, the RBA’s preferred measure of underlying inflation, edged up to 3.4%. Housing was the largest contributor at 6.3%, with electricity 22.5% higher over the year as government rebates rolled off.

In plain terms: the headline number is cooling, but the core pressures the RBA watches most closely are still above the 2 to 3% target band.

What the major banks and markets are predicting

As of early June, all four major bank economics teams expect the cash rate to be held at 4.35% on 16 June. Economists part ways on what comes after.

NAB has revised its cash rate forecast just this week. Where previously NAB expected one more rate hike in 2026, they now expect the cash rate to remain on hold before we see three 0.25% rate cuts next year.

CBA have also shifted their forecasts, expecting rates to remain on hold in 2026, followed by two 0.25% rate cyst in May & August of 2027. Here’s what each major bank’s economics team expects for the rest of 2026:

**As of June 9, 2026

What this means for loan repayments

To put the cumulative pressure into perspective, Canstar’s analysis of the three 2026 rate hikes shows just how much the increases have added to monthly repayments across different loan sizes, before a potential fourth move is even on the table.

The three 2026 hikes have quietly undone last year’s relief. According to Canstar, the
February, March and May rises together added about $272 a month to repayments on a $600,000 loan with 25 years left. That is not a one-off. It is an extra $272 every month, for as long as the rate stays where it is.

Over the course of 12 months, that adds up to roughly $3,300 in additional repayments than if there had been no rate hikes this year. With the possibility of more rate hikes to come, now is a good opportunity to review your current situation.

What can you do if you’re concerned about
repayments?

1. Know your current rate. Dig out your last statement and find the exact rate you are paying. You cannot tell if you are on a good deal until you know your starting point.
2. Calculate the impact. Use our calculator to see what your repayments look like now, and what a future increase would do to them.
3. Talk to an expert who compares lenders. A YBR broker can compare your loan across a wide panel and tell you, plainly, whether refinancing would help. As a non-bank backed network, our brokers work for you, not a single lender.

Rate decisions are easier to handle when someone in your corner knows your situation. A YBR broker can review your loan, compare lenders and help you decide whether to refinance or hold steady. Start at ybr.com.au/refinance-home-loan/, or reach out to your local broker.

1. Australian Bureau of Statistics, https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/consumer-price-index-australia/apr-2026
2. Cotality, Home Value Index, June 2026
3. Australian Bureau of Statistics, https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/consumer-price-index-australia/apr-2026