Economic commentary

July 8, 2025

NAB Monetary Policy Update – 8 July 2025

RBA surprises with a hold, NAB still sees cuts in August, November and now February

By NAB Group Economics

Key points

  • The RBA surprises by holding the cash rate at 3.85%
  • The RBA’s interpretation of the recent data flow is similar to our own, but amid elevated uncertainty they have opted for caution: more gradualism but less predictability
  • The RBA is “looking for confirmation we are still on the path” but this is a “decision on timing but not direction”
  • We still see the need for the RBA to normalise rates, with consumption so far having recovered more slowly than earlier expected and amid global downside risks
  • NAB continues to expect cuts in August and November and have added a cut in February.

For further details, please see the NAB Monetary Policy Update (8 July 2025) (PDF, 125KB), opens in new window

Business     Economic commentary     Economics     Finance     Interest rates     RBA