RBA to cut interest rates in July: What this means for Australian homeowners
Tired of too many ads?
Remove Ads
Westpac: Chief Economist Luci Ellis highlighted that the May CPI indicator 'came in below even the low number that we expected,' prompting the bank to bring forward its rate cut forecast to July. Westpac now expects the cash rate to eventually fall to 2.85%, implying three further 25 basis point cuts after July.
Commonwealth Bank: Economists expect two 25 basis point cuts this year—one in July and another in August—citing easing inflation and the RBA's dovish tone. They predict the cash rate will reach 3.35% by the end of the cutting cycle.
NAB: NAB's economists also anticipate a July cut, followed by two more in August and November, bringing the rate to 3.10%.
What does a 25 basis point cut mean for homeowners?
Tired of too many ads?
Remove Ads
Australia's financial landscape is set for a shake-up as the Reserve Bank of Australia (RBA) is widely expected to cut the official cash rate by 25 basis points at its meeting on July 8, 2025. This move would bring the cash rate down to 3.60%, offering immediate relief to mortgage holders.In a rare show of consensus, Westpac , Commonwealth Bank, and NAB have all publicly forecast a rate cut following the July RBA meeting. These predictions come on the back of softer-than-expected inflation data, with the latest Australian Bureau of Statistics figures showing annualised inflation at just 2.1%—comfortably within the RBA's 2–3% target band.ANZ, however, is holding on to its forecast for a cut in August, not July, making it the outlier among the big four. ANZ has described the rate cut path as the 'path of least regret,' but is cautious about acting too soon, preferring to wait for further data before recommending a move.If the RBA moves to slash rates tomorrow, the cash rate will drop from 3.85% to 3.60%. For a typical Australian mortgage of $600,000, this could mean a reduction in repayments of about $90 per month—assuming banks pass on the full cut to borrowers. This would bring their total monthly savings to $273 since rate cuts began earlier this year.For larger mortgages, such as $1 million, the monthly savings could reach $150. These cumulative savings are providing crucial breathing room for households, especially after a prolonged period of high rates.The impact of these cuts is more than just numbers: the share of mortgage holders considered 'At Risk' of mortgage stress is projected to fall from 26% to 24.7% after the July cut, equating to about 99,000 fewer households under financial pressure. Lower repayments will allow families to redirect funds to other essentials or build a financial buffer.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
&w=3840&q=100)
First Post
3 hours ago
- First Post
From pineapples to chips and rare earths, China weaponizes everything
From blocking Taiwanese pineapples to slapping tariffs on Australian wine and restricting chip exports to the West, China has long used trade as a tool of geopolitical pressure. Now, the country is turning to rare earth elements, which are more strategic and potent, according to a report read more From blocking Taiwanese pineapples to slapping tariffs on Australian wine and restricting chip exports to the West, China has long used trade as a tool of geopolitical pressure. According to a Financial Times report, now, the country is turning to something far more strategic and potent: rare earth elements. Soon after Beijing imposed new restrictions on exporting rare earth minerals and the specialised magnets made from them, the global auto industry warned of potential shortages that could lead to factory shutdowns. STORY CONTINUES BELOW THIS AD China's strategic use of rare earth sanctions this spring was likely a decisive factor behind Washington's decision to roll back its tariff increases on the country, added the report. This marks a new chapter in Chinese economic statecraft, demonstrating a sanctions approach capable of exerting pressure not just on smaller neighbours, but on the world's largest economy as well. According to the report, while China has frequently employed economic sanctions in recent years, many of these actions have been blunt and only partially effective. Often, punitive measures were subtle or officially denied - for instance, claims that Chinese tourists lost interest in visiting the Philippines, Taiwanese pineapples failed health inspections, or Chinese consumers simply chose not to buy Korean products. Government-backed boycotts have inflicted economic pain on China's trade partners but delivered mixed political results. They've deterred some countries from hosting the Dalai Lama or contesting Beijing's South China Sea claims, yet faltered on core national interests, added the report. Australia stood firm despite China's wine import cuts over policy disputes. South Korea kept its missile defence system despite Chinese sanctions. And China's earlier sanctions against the US — including blacklisting defence companies and imposing licensing regimes on certain mineral exports — have been more political signal than economic substance. STORY CONTINUES BELOW THIS AD Rare earth export controls The new rare earth export controls are different. In weeks, they threatened to close major auto factories — the largest sector in advanced economies — and pressured the US into rolling back its trade war measures. According the Financial Times report, in just a handful of weeks they threatened to shutter key factories across the auto industry — the largest manufacturing sector in most advanced economies. They also brought the US president to heel on his signature initiative: the trade war. The White House believed it had secured escalation dominance, assuming soaring tariffs would force Beijing to negotiate due to unbearable costs. However, China's leaders were willing to bear the political fallout from the tariffs, while Washington couldn't overlook the critical loss of rare earth materials and its severe impact on the auto industry, added the report. Why these sanctions worked China's latest sanctions succeeded in part because Beijing has refined its toolkit, creating a legal framework to restrict strategic exports and gaining deeper insight into the vulnerabilities of its trading partners, reported FT. STORY CONTINUES BELOW THIS AD It has even extended its reach extraterritorially, demanding that companies abroad avoid using Chinese minerals in products destined for the US defence industry. Beijing's strategy relied on the assumption that other major partners would not blame China for the rare earth restrictions, but instead pressure Washington to ease tariffs, added the report. Since April, Chinese exports of rare earth minerals and magnets have dropped not only to the US but also to key partners like Japan and South Korea. Indian automakers have cut production amid material shortages, while European Commission President Ursula von der Leyen highlighted rare earth magnets at the June G7 meeting to urge greater non-China production. The EU is now prioritising rare earth exports in its diplomatic talks with China. China's rare earth restrictions have had broad global effects, revealing limits in its ability to precisely target only the US. It's easier to control specialised equipment than widely traded commodities like rare earth oxides, which other countries can still sell quietly to American buyers. STORY CONTINUES BELOW THIS AD The most striking issue is how unprepared Western governments and companies were. Despite widespread awareness of China's dominance, the West has failed to secure alternative suppliers since China first cut rare earth exports to Japan in 2011. Some progress was made — South Korea built stockpiles and Japan invested in Australian mines — but most Western critical minerals strategies lacked funding. Manufacturers claim resilience but often keep just a week's supply of rare earth magnets. This was a clear vulnerability they ignored — and Beijing's move was no surprise. With inputs from agencies
Indian Express
5 hours ago
- Indian Express
Canva Visual Suite 2.0 hands-on: 5 ways AI can boost productivity
As the generative AI boom continues to reshape the tech industry, design software companies like Canva could emerge as some of its biggest beneficiaries. Founded in 2013, Canva started out as a web app that sought to make design tools cheaper, accessible, and simpler to use. Over the last few years, the Australian tech startup has pursued a more ambitious goal of building a 'world-class suite of visual AI tools.' Canva has been making efforts to diversify its platform with office suite-like tools and productivity features, signalling a bold move to challenge not just Adobe but also heavyweights like Google and Microsoft. It acquired generative AI startups Affinity and last year. Canva also announced that it plans to hike its subscription prices for certain business customers to reflect the expanded product experience. But is it worth it? In April this year, Canva unveiled its revamped Visual Suite which made its productivity and design tools accessible through a single interface. Alongside the Visual Suite 2.0, the platform also introduced a new conversational AI bot, an AI coding agent, an AI-powered spreadsheet generator, an upgraded photo editor, and more. As Canva looks to grow its customer base of around 230 million users by giving workplace design tools an AI edge, here is my first-hand experience of using the Visual Suite 2.0 to automate labour-intensive design tasks and streamline my workflow as a tech journalist. I've always wanted to find a way to easily turn my long-form news articles and explainers into visual formats to make them more accessible and reach a broader audience. Typically, I would have had to depend on the social media team or designers for this. But the process is much simpler using Canva AI, the platform's voice-enabled conversational AI that was unveiled at its annual Create event earlier this year. Canva AI can be used to generate text, slides, and images. It can also be used to edit photos and resize designs with just textual or voice prompts. The feature can be accessed on the Canva homepage. It is located above the search bar, next to the Templates tab. The chatbot is powered by Canva's foundational AI models that have been trained on datasets containing the creative designs of users who have opted in to AI training. Canva AI also comes in handy as a tool to provide guidance on how to access the myriad design features and options on the platform. You can also switch to design mode anytime by clicking on the Use Canva Editor button. However, I was a bit disappointed to find that Canva AI is not yet available directly within design templates. Vibe-coding is all the rage these days. Canva Code, its AI coding tool, has been designed to generate landing pages for websites, calculator apps, custom widgets, educational quizzes, and more. Canva Code is accessible by visiting the homepage and clicking on the search bar, which expands to show a variety of options such as create an image, create a video clip, draft a doc, etc. To put it to the test, I used Canva Code to develop a custom tool that helps me log how many news articles I publish in a day, their titles, word count, etc, with a monthly summary. The output was better than what I expected with some additional features thrown in such as Status and Priority. The design of the tool also had a Canva-like aesthetic to it. Any software tools or elements generated using Canva Code can also be embedded in other designs. In order to test drive the suite of visual AI tools on Canva, I helped a friend of mine create a set of social media cards inviting people to hire him for projects on a freelance-basis. The AI-generated designs were edgy with eye-catching colours. And any unnecessary text could be easily removed using the point-and-click editing option that is part of Canva's upgraded Photo Editor. However, Canva AI struggles with generating more of the same designs. It also does not get the fine details right, which meant that I had to manually take over and tweak the designs in Canva Editor most of the time. While my work typically does not involve making spreadsheets, it often requires breaking down data provided by tech companies and gathering insights. To make this task easier, I imported the data from Meta's financial report for the fourth quarter of 2024 and used Canva Sheets to better visualise it. With the help of Magic Insights, I was able to easily analyse Meta's financial statements and identify patterns in the data. Canva Sheets is built on top of its Magic Studio suite of AI tools. Users can also import data from Google Analytics, HubSpot, Snowflake, and Statista to Canva Sheets in order to simplify data-driven work. In addition, Magic Charts allows users to create AI-generated infographics. Magic Studio at scale also allows you to select a portion of the data in a spreadsheet and create an AI-generated marketing campaign based on that data. Photo-editing is one of the most common use cases of Canva. However, when it comes to news articles about AI and other technologies, finding the right lead images can be challenging as these topics are often abstract and lack clear visual representation. Canva's upgraded Photo-editor comes in use here as it can be used to modify images with AI-generated backgrounds and more. Point-and-click is another useful feature that lets users modify selected elements within an image using AI. Visual Suite 2.0 also allows users to add various design templates including documents, presentations, social media posts, etc, in a single design window. This is definitely a game-changer as it removes the need for separate tools, scattered workflows, and disconnected files.
Mint
6 hours ago
- Mint
Yen falls after Trump tariff letter; Aussie jumps after surprise RBA hold
Trump unveils 25% tariffs on Japan, South Korea Japan's yen struggles to recover from losses RBA leaves rates unchanged, Aussie jumps By Rae Wee, Amanda Cooper SINGORE/LONDON, - The yen took a hit on Tuesday from U.S. President Donald Trump reiterating his plan to impose 25% tariffs on goods from Japan and South Korea in the latest twist of his chaotic trade war. The Australian dollar charged higher after the country's central bank defied market expectations and left its cash rate steady at 3.85%. Trump on Monday began telling trade partners – from powerhouse suppliers like Japan and South Korea to minor players – that sharply higher U.S. tariffs will start August 1, but he later said that he was open to extensions if countries made proposals. The yen weakened as U.S. trading got underway, leaving the dollar up 0.3% on the day 146.56. Prime Minister Shigeru Ishiba said on Tuesday he would continue negotiations with the U.S. to seek a mutually beneficial trade deal. "There is still a lot of uncertainty as to where tariff rates will eventually settle and which countries will get what rates, so uncertainty about the global economy is still high and that will keep investors on edge for the time being," said Carol Kong, a currency strategist at Commonwealth Bank of Australia. "This is just the start and we'll get more headlines out for sure over the coming days." The European Union will not receive a tariff letter and could secure exemptions from the U.S. baseline rate of 10%, EU sources familiar with the matter told Reuters on Monday. Reflecting the contrasting fortunes of the two trading partners, the euro hit a one-year high against the yen and was last up 0.6% on the day at 171.95. The euro rose against the dollar as well, up 0.2% to $1.1731. "The view of the market is that it's an extension, including in some cases more talks. So that's positive," Frederik Ducrozet, head of macroeconomic research at Pictet Wealth Management, said. "More of the same, less bad than feared with the door still open to negotiation, I can understand why the market is taking it in a relatively benign way," he said. The South Korean won also fared better than its Japanese counterpart, rising 0.4% to 1,369.86 per dollar, recovering from Monday's 1% fall. South Korea said it planned to intensify trade talks with the United States. RBA STUNS MARKETS The standout performer among the major currencies on Tuesday was the Aussie dollar, which rose more than 1% in response to the RBA's surprise decision to leave rates unchanged. It was last up 0.8% at $0.6545. Markets had positioned for a cut, yet the central bank said the board "judged that it could wait for a little more information" to confirm that inflation was slowing. Still, the board did note that the risks to inflation were more balanced and appeared to be waiting for a reading on second quarter prices due at the end of July before deciding. "The uncertainty around Trump's tariffs means that it doesn't embolden a decisive decision, whereas the need for more assurance over inflation means they probably want to wait out this meeting and get into August," said Vishnu Varathan, head of macro research for Asia ex-Japan at Mizuho. Markets shifted to imply around an 85% chance the RBA would indeed cut to 3.60% at its August 12 meeting, and now favours rates bottoming at 3.10% rather than 2.85%. The New Zealand dollar was last up 0.3% at $0.602, while sterling fell 0.2% to $1.358. This article was generated from an automated news agency feed without modifications to text.
