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NAB updates cash rate call, joins other big four banks in forecasting hold for February

Eden Radford avatar
Eden Radford
- 4 min read
NAB updates cash rate call, joins other big four banks in forecasting hold for February

NAB, Australia’s third largest bank, has today updated its cash rate forecast, changing from a 0.25 percentage point hike in February, to a hold.

This now means all four big bank economic teams believe we are already at the peak of the current cash rate cycle at 4.35 per cent.

All four economic teams predict there will be at least one cash rate cut in the second half of 2024, although the size and timing vary between the big banks.

Current big four bank cash rate forecasts

Peak of current cycleFirst cutNo. of cuts forecasted in 2024
CBA4.35%Sep-243
Westpac4.35%Aug-242
NAB4.35%Nov-241
ANZ4.35%Q41

Source: RateCity.com.au

RateCity.com.au research director, Sally Tindall, said: “It’s hugely encouraging to see all big bank economic teams now predict we’ve seen the last of the cash rate hikes in this cycle, but borrowers shouldn’t get too excited just yet.”

“The RBA hasn’t yet ruled out the possibility of another hike so Australians shouldn’t either,” she said.

“At this stage, another hike is looking increasingly unlikely, on the back of better than expected inflation figures, however, borrowers should make sure there’s room in the tank for one more, just to be on the safe side.

“While the cash rate is likely to go down at some point, if you’ve got a mortgage, don’t bank on this happening in 2024.

“No one knows what’s around the corner with 100 per cent certainty - not even the RBA.

“If you need financial relief, don’t wait around for the RBA or the government to serve it up on a platter.

“Take the bull by the horns and seek it out for yourself,” she said.

Tips to get the best out of your budget

Push for a pay rise: If you haven’t had a decent wage increase recently, now is the time to ask your boss for more. Alternatively, you could look for part time work as a second job. A pay rise or a regular second job isn’t a one-off win – it’s extra money in your budget, month after month.

Refinance the mortgage: Switching to a lower interest rate on your mortgage is one of the most effective ways to inject real, ongoing relief into your budget.If you can’t refinance, haggle with your lender for a rate cut. If you are an owner occupier who has been paying down your debt for a few years, you should be paying a rate that is under 6 per cent.

Food matters: food is the second biggest expense for most families after the mortgage or rent so put it under the microscope.

Keep an eye on your energy costs: Make sure you’re on the lowest price plan for your energy needs and try and conserve energy where you can.

Make sure you’re getting all the benefits you can: Family tax benefit A / B, childcare assistance – up since July, energy bill relief, even the kids sports vouchers from the government are worth something. Find out what you are eligible for via the government links (at end).

Use it or lose it: Check on your direct debits to see what you’re paying in the background. If there are any subscription services you haven’t used for the last month, give them the flick.

Resources for people in financial stress:

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Product database updated 16 Apr, 2024

This article was reviewed by Research Director Sally Tindall before it was published as part of RateCity's Fact Check process.

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