Homeowners wishing for more relief on their variable home loans may have to wait until next year after the RBA kept interest rates on hold at its September meeting today.

Just two meetings remain – in November and December – for the calendar year, which has already seen the main cash rate target fall from 4.35 per cent to the current rate of 3.6 per cent.

Experts remain divided over whether the central bank will slash rates again prior to Christmas, with a relatively steady labour market and strong inflation providing more incentive for the RBA to move slowly.

In its monetary statement today, the RBA board said it was keeping a close eye on Australia’s domestic market and the ongoing turmoil of tariff-driven geopolitics, while Governor Michele Bullock added next month’s quarterly inflation figures will be crucial.

“The board sees the risks as broadly balanced and it remains data-driven,” she said.

“By the next meeting in November, we’ll have more data on the labour market and inflation data for the September quarter.

“We’ll also have some more forward-looking indicators, including from liaison and an updated set of forecasts.”

While Treasurer Jim Chalmers said today’s decision would be disappointing for Australians with a mortgage, Bullock had a far bleaker message for those who wanted but couldn’t afford to buy their first home.

“We’re in a very difficult position with the property market,” she said.

“And I don’t think that most reasonable people think that this is a good outcome.”

She added that the main driver of increasing property prices is the chronic undersupply of housing – not interest rates – and that governments are finally starting to address that issue.

But she said it’s years away from starting to improve.

“It’s going to be slow to work its way through, it’s going to take time… I’m not confident it’s going to make any impact in the next two years,” she said.

‘Good news’ around the economy despite uncertainty

Two unexpectedly high instalments of monthly inflation data had effectively scuppered any chance of a rate cut before this week’s meeting had even started, but Bullock said that wasn’t necessarily bad news for the economy.

She said the increase in prices was driven at least in part by rising incomes, and that consumers getting out and spending was a positive story.

“That’s good news,” Bullock said.

“It’s good news that activity is responding. So I don’t want anyone to think that’s bad news, but it just makes us think, well… it was a good decision today to hold.”

At the same time, her monetary policy board said the path forward remains murky.

“The board remains alert to the heightened level of uncertainty about the outlook,” it said in its post-decision statement.

“It noted that monetary policy is well placed to respond decisively to international developments if they were to have material implications for activity and inflation in Australia.”

Another consideration for the central bank was analysing the impact of its three rate cuts already made this year.

“Financial conditions have eased since the beginning of the year and this seems to be having some impact, but it will take some time to see the full effects of earlier cash rate reductions,” the board said.

“The board judged that it was appropriate to remain cautious, updating its view of the outlook as the data evolve.”

Three of the big four banks, including CBA, Westpac and ANZ, think there will be another cut of 25 basis points in early November.

NAB, which earlier indicated it too thought a November rate cut was in play, recently updated its forecast to scrap any change to the cash rate target for 2025.

Graham Cooke, head of consumer research at Finder, said the meeting-to-meeting variability of interest rates was still having a material impact on Aussie families.

“While relief is starting to filter through, 35 per cent of homeowners are still struggling to pay their mortgage in September,” he said.

“Even with another cut expected before Christmas, you don’t need to wait to get a better deal. If you’re currently paying more than 5.5 per cent for a variable rate, you’re probably paying too much.”

This year has already seen three interest rate cuts in February, May and August.

Canstar data shows that for the average Australian borrower with a $600,000 mortgage, three cuts is currently equating to a monthly drop of $272 this year.

Sally Tindall, data insights director at Canstar, said most are taking these savings and re-injecting them into the loan.

“That’s a decent chunk of money that is already making a difference to household budgets,” she said.

“It’s astounding to see that so many eligible borrowers aren’t pocketing this relief into their bank account but rather, reinvesting it into their mortgage instead.

“By keeping their repayments unchanged, they’re effectively turning each RBA cut into an extra mortgage repayment, which, if kept up for the remainder of their loan, could see them save thousands.”

Tindall said while the RBA has held steady for this meeting, many borrowersv were unknowingly servicing a loan with a higher interest rate than necessary.

“Borrowers looking to turbo-change the savings even further should consider switching to a lower rate mortgage,” she said.

“Right now, the average owner-occupier on a variable rate is estimated to be paying 5.53 per cent, yet there are more than 30 lenders on Canstar offering at least one variable rate under this mark.

“While the RBA will wait for and act on the data, borrowers don’t have to play this waiting game.”