18/09/2025
Mortgage holders and property investors could see another interest rate reduction in November, but the Commonwealth Bank of Australia now expects this to be the last cut in the current cycle. Previously, the bank had anticipated additional easing into 2026, but recent economic trends have prompted a more cautious outlook.
CBA economists point to a faster-than-expected recovery in the economy, meaning fewer rate cuts will be required. The bank is predicting a 25-basis point reduction in November, following the Reserve Bank of Australia’s third rate cut this year in August, which brought the official cash rate down to 3.60%.
Lower interest rates have provided some relief to households and property investors, many of whom have been under pressure from high living costs and rising housing prices. Despite the cuts, the central bank has taken a measured approach, indicating that future decisions will depend on how key economic indicators, such as inflation and employment, develop in the coming months. The RBA continues to target an inflation range of 2 to 3%, while unemployment remains low at 4.2%.
The latest consumer price data shows inflation easing. Headline CPI slowed to 2.1%, down from 2.4% in the previous quarter, while trimmed mean inflation declined to 2.7% from 2.9%. Consumer spending has shown mixed signals, with rises in late August followed by declines in mid-September, highlighting ongoing uncertainty in household demand.
The Reserve Bank’s next meeting is scheduled for 29 to 30 September, and all eyes will be on the data to gauge whether November’s cut will indeed be the last.
What This Could Mean for Borrowers, Brokers and the Finance Industry
If November does bring the final reduction, the period of falling borrowing costs will be coming to an end. Homeowners and property investors may face stabilising repayments, meaning those looking to refinance or secure new loans may need to act quickly to take advantage of lower rates.
For brokers, the conclusion of the easing cycle will shift the focus from chasing rate reductions to providing clients with comprehensive financial strategies. Advising on loan structures, offset accounts, and debt management solutions will become more important as clients seek to make their finances more resilient in a period of limited rate cuts.
At an industry level, this suggests a move from a rate-driven environment to one guided by economic fundamentals. Banks and lenders may become more cautious in extending credit, and innovation in products and services will be key to staying competitive.
Looking ahead, the finance sector is likely to experience steadier but less aggressive growth. Borrowers and investors will need to adopt a more strategic approach to managing loans and investments, while brokers who provide tailored guidance are likely to become essential partners for clients navigating this changing landscape.
