RBA Rates Announcement Dec 2023

05.12.23 | Marc Barlow | News

As many Melburnians ramp up their end-of-year festivities, the RBA delivered a timely official cash rate pause by holding it steady at 4.35%. 

Following last month’s 0.25% increase, there had been an expectation that the RBA would ramp up its official rate once more before the end of 2023. 

The argument was that another rise would cover the two-month gap between board meetings – the next being on February 6, 2024. 

However, most analysts tipped a pause today, with the Central Bank explaining today that inflation has softened. 

The monthly CPI indicator for October suggested that inflation is continuing to moderate, driven by the goods sector. Overall, measures of inflation expectations remain consistent with the inflation target,’ explained the RBA today. 

‘Whether further tightening of monetary policy is required to ensure that inflation returns to target in a reasonable timeframe will depend upon the data and the evolving assessment of risks.’

In the past month, new RBA Governor Michele Bullock implemented the first interest rate hike since assuming her role several months ago. 

This move ended a four-month period of rate stability and propelled the rate to its highest point in 12 years.

The decision to raise interest rates was prompted by the RBA’s acknowledgment, conveyed through public messaging, that tackling inflation had proven to be a more persistent challenge than initially perceived. 

Consequently, today’s announcement brings relief to those who were preparing for a potential rate increase just before the festive season.

As we look ahead, the RBA projects that inflation will linger slightly below 3.0% by the close of 2025, within the target range of 2-3%. 

Additionally, the Organisation for Economic Co-operation and Development (OECD), in its global report, observed that official rate increases in Australia have likely reached their peak.

‘Domestically, there are uncertainties regarding the lags in the effect of monetary policy and how firms’ pricing decisions and wages will respond to the slower growth in the economy at a time when the labour market remains tight,’ added the RBA today. 

Will there be another rate rise in 2024? In the rates forecasting business, that’s anyone’s guess right now. 

With a two-month gap before the next announcement, the upcoming summer months will shape whether the RBA will deem it necessary to lean into additional measures to cool spending.


If rates hold concerns for you, contact Mortgage Broker Melbourne. We’re one of the most positively reviewed mortgage brokers in Melbourne.


Furthermore, we can help you with tips on how to uncover lower rates, boost your savings, consolidate other debts and take the pressure off increases in household costs.

And finally, to our valued clients, we wish you a prosperous and safe New Year from all the team at Mortgage Broker Melbourne.