12 August 2025 — The Reserve Bank of Australia (RBA) has reduced the official cash rate to 3.60 per cent, signalling confidence that inflation will remain steady within its 2–3 per cent target range over the next two years.

The central bank’s latest Statement on Monetary Policy shows that price pressures have eased faster than expected, while household and business spending has recently picked up despite slower overall economic growth.

Unemployment has risen slightly but remains low, with the RBA forecasting it will stabilise just below 4.5 per cent. Jobs growth is tipped to moderate from the rapid pace seen in recent years.

The RBA expects Australia’s economy to strengthen modestly over the coming year, helped by recent rate cuts, even as global growth slows. Risks from potential trade tensions have eased somewhat, with only a limited impact on domestic forecasts.

Governor Michele Bullock said the decision to cut rates reflected a balance between supporting growth and maintaining inflation stability. “The Board is prepared to respond if conditions change,” she added.