Will the RBA hike the cash rate in April 2023? CBA, ANZ, NAB, and Westpac home loan predictions

Collage of a person lifting a huge yellow block.

It’s been nearly one year since the Reserve Bank of Australia began raising the cash rate to curb inflation, taking us from 0.10% in May 2022 to 3.60% in March 2023. Many economists agree we’re approaching the end of this tightening cycle, as the economy has shown signs of contraction. But has the RBA gone far enough in its crusade to slow the economy?

Let’s unpack the predictions for the 4 April RBA meeting and consider where home loan interest rates will land.

Could the April RBA decision be the last rate hike? Why economists are split

Collage of a person hanging onto a flattening graph line.

At the moment, the Australian economy teeters at a tipping point. Consumer confidence is down and property prices appear to have bottomed out amidst abysmal sale stock. Retail trade has shown modest growth, largely trending flat throughout the summer, though it’s still too high to halt runaway inflation, which clocked in at 6.9% over the year to February 2023. 

While this is markedly down from the 8.4% and 7.6% reported in the year to December and January, respectively, it’s still stubbornly above the 2% - 3% RBA target. 

“There are indications coming through that say the Reserve Bank needs to go a little bit further, but then there are other indicators that say that it shouldn't go any further,” explains Mozo banking expert, Peter Marshall. 

“So it’s really hard to make a call on which way the RBA will choose to play it. People are already feeling the cost of living pressures acutely. But at the same time, inflation hasn’t come down far enough. Spending hasn't really slowed as much as the Reserve Bank would like. And then there are lots of things going on in the banking system internationally that suggest that perhaps now is not a great time to increase interest rates, so could definitely go either way.” 

Last month, both the US and UK reserve banks lifted their own official interest rates by 0.25%, despite both economies experiencing signs of contraction. As guardian of Australia’s monetary policy, the RBA would have good reason to want to move 0.25% in April as well to remain competitive with some of our biggest trading partners. 

However, with growing calls for respite at home, the RBA may keep its eyes on our own island for now. When announcing the March decision, RBA governor Philip Lowe softened his language about the path of future rate hikes, indicating that the board will heavily watch economic indicators as they chart a course forward. 

“The Reserve in Australia may decide that it can wait a month before raising rates, just to take a little breather,” says Marshall. 

“It would be good, I think, if they did take a break, but that doesn’t mean there are no more rate rises at all.”

So the RBA may have another 0.25% cash rate movement in store. The question remains: will we see it in April, or later down the track?

How high will rates go? Westpac, CBA, NAB, and ANZ rate predictions for April 2023

Collage of a person leaping down yellow blocks.

At the time of writing, the Big Four banks are split down the middle as to whether we’ll get a 0.25% bump to the cash rate in April. Everything is less of a certainty and more of a coin flip. 

Westpac argues the RBA will pause in April before moving again for the last time in May, bringing the final cash rate to 3.85% for the cycle, before the RBA makes 1.50% worth of cuts throughout 2024 - 2025.

Similarly, CBA believes there's a 55% change the RBA will pause in April before potentially moving in May if there's an economic case for it until any rate cuts in 2024. The big bank concedes there's a 45% of a 0.25% hike in April. 

ANZ and NAB foresee two more movements over the next three months, bringing the final cash rate to a staggering 4.10%  in June. Both predictions involve a steady hand either in April or May.

Cash rate peak predictions from the big banks (30 March 2023)

April 2023
May 2023
June 2023
CBA
Nil3.85% p.a. OR Nil-
WestpacNil3.85% p.a.-
NAB3.85% p.a. OR Nil3.85% p.a. OR Nil4.10% p.a.
ANZ3.85% p.a. OR Nil3.85% p.a. OR Nil4.10% p.a.

Out of all the Big Four banks, only Commonwealth Bank and NAB have consistently made the right call over the last six months – others have usually skewed too hawkish in their estimates. But as the predictions narrow and the cycle ends, it may be too close to call.

Loan details

Rate change

Repayment change if rates go up

What does a cash rate pause mean? Preparing for the future home loan market

Collage of a man falling down between two yellow cliffs.

After scrambling to raise rates for so long, the idea of the ship holding steady seems almost alien. So what would a constant cash rate mean for the rest of 2023?

“A steady cash rate gives people a bit more confidence to plan their futures: to buy houses, borrow money, spend money, all the stuff that says the economy is alive,” says Mozo expert Peter Marshall. 

Most urgently, however, Marshall warns that the moment rates hold or even drop, the property market could explode again. This would mean a sharp rise in prices, strong competition at auctions, and for sale signs that disappear within days. 

“The number of houses for sale right now is incredibly low,” explains Marshall. “It has been since the start of this year. I’ve seen plenty of evidence that people are willing to pay silly money just to get the deal done and have a house.”

“So I think as soon as people get the confidence that the RBA is done or pretty much done with increasing rates, it’s all going to take off again and will go like a rocket.”

As such, now may be the perfect time to move on a property if you can. So run your finances through the first home buyer checklist, do an insurance inspection, and get your ducks in a row. 2023 may be the most interesting year for property yet.

Compare home loans below. For award-winning picks from 2023, check out our best home loans hub.

Home loan comparisons on Mozo

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Last updated 22 June 2024 Important disclosures and comparison rate warning*
  • Basic Home Loan

    • Owner Occupier
    • LVR<60%
    • Principal & Interest
    Interest rate
    6.14 % p.a.
    Variable
    Comparison rate
    6.16 % p.a.
    Initial monthly repayment
    $3,043
    Go to site

    Enjoy a low rate home loan with $0 application fee and $0 ongoing fees. Flexibility to split your loan and set different repayment types. Fee free redraw from your loan using online banking. Flexible ways to repay. 40% Deposit required.

  • Unloan Variable

    • Owner Occupier
    • LVR <80%
    Interest rate
    5.99 % p.a.
    Variable
    Comparison rate
    5.90 % p.a.
    Initial monthly repayment
    $2,995
    Go to site

    Built by CommBank, the Unloan is the first home loan with an increasing discount (conditions apply) for borrowers. No application or banking fees. No monthly account keeping or early exit fees. Apply online in minutes.

  • Offset Home Loan

    • Owner Occupier
    • LVR<60%
    • Principal & Interest
    Interest rate
    6.14 % p.a.
    Variable
    Comparison rate
    6.39 % p.a.
    Initial monthly repayment
    $3,043
    Go to site

    Ability to open up to 10 offset accounts per loan account. Fast online application. Linked Debit Mastercard® with fee-free access at ATMs across Australia. Package a credit card with your home loan and the annual card fee will be waived (T&Cs apply). 40% deposit required.

  • Unloan Variable

    • Owner Occupier
    • LVR <80%
    Interest rate
    5.99 % p.a.
    Variable
    Comparison rate
    5.90 % p.a.
    Initial monthly repayment
    $2,995
    Go to site

    Built by CommBank, the Unloan is the first home loan with an increasing discount (conditions apply) for borrowers. No application or banking fees. No monthly account keeping or early exit fees. Apply online in minutes.

  • Discount Variable Home Loan

    • Owner Occupier
    • LVR<70%
    Interest rate
    5.99 % p.a.
    Variable
    Comparison rate
    6.01 % p.a.
    Initial monthly repayment
    $2,995
    Go to site

    A low rate home loan for owner-occupiers packed with great features including unlimited extra repayments, free online redraw, no application or monthly admin fees. Rate will vary depending on LVR. Winner of a Mozo Experts Choice 2024 Low Cost Home Loan Award^

  • Variable Home Loan 90

    • Principal and Interest
    • LVR <90%
    Interest rate
    6.04 % p.a.
    Variable
    Comparison rate
    6.06 % p.a.
    Initial monthly repayment
    $3,011
    Go to site

    Affordable home loan rate for buyers or refinancers. No monthly or ongoing fees. Option to add an offset for 0.10%. Access to savings with unlimited redraws available. Minimum 10% deposit required.

  • Fixed Rate Loan

    • Owner Occupier
    • Principal & Interest
    • LVR <80%
    Interest rate
    6.09 % p.a.
    Fixed 3 years
    Comparison rate
    6.15 % p.a.
    Initial monthly repayment
    $3,027

    Additional repayments of up to $10K per fixed year. Interest rate discounts available. Waiver of $499 application fee when combined with an Orange Advantage Home Loan.

  • The Better Home Loan Special Offer

    • Owner Occupier
    • Principal & Interest
    • LVR<80%
    Interest rate
    6.14 % p.a.
    Variable
    Comparison rate
    6.14 % p.a.
    Initial monthly repayment
    $3,043
    Go to site

    Enjoy a variable rate home loan with a bunch of features from Police Credit Union. Make extra repayments at any time without penalty. No monthly, annual or upfront fees. Free online redraw. Minimum 20% deposit. Qualifying criteria applies. Minimum loan amount is 200K. For new customers only. Mozo Experts Choice Home Lender Credit Union of the Year 2023.

  • Basic Home Loan

    • Owner Occupier
    • LVR<60%
    • Principal & Interest
    Interest rate
    6.14 % p.a.
    Variable
    Comparison rate
    6.16 % p.a.
    Initial monthly repayment
    $3,043
    Go to site

    Enjoy a low rate home loan with $0 application fee and $0 ongoing fees. Flexibility to split your loan and set different repayment types. Fee free redraw from your loan using online banking. Flexible ways to repay. 40% Deposit required.

  • Mortgage Simplifier

    • LVR<80%
    • Owner Occupier
    • Principal & Interest
    Interest rate
    6.14 % p.a.
    Variable
    Comparison rate
    6.17 % p.a.
    Initial monthly repayment
    $3,043

    Get a competitive variable rate with ING’s Mortgage Simplifier. Free extra repayments, no monthly or annual fees. Freedom to make free extra repayments or redraws.

  • Offset Home Loan

    • Owner Occupier
    • LVR<60%
    • Principal & Interest
    Interest rate
    6.14 % p.a.
    Variable
    Comparison rate
    6.39 % p.a.
    Initial monthly repayment
    $3,043
    Go to site

    Ability to open up to 10 offset accounts per loan account. Fast online application. Linked Debit Mastercard® with fee-free access at ATMs across Australia. Package a credit card with your home loan and the annual card fee will be waived (T&Cs apply). 40% deposit required.

  • Basic Home Loan

    • Fixed
    • Owner Occupier
    • Principal & Interest
    • LVR<70%
    Interest rate
    6.25 % p.a.
    Fixed 3 years
    Comparison rate
    6.20 % p.a.
    Initial monthly repayment
    $3,079
    Go to site

    No upfront or ongoing fees. Free extra repayments and redraw facility. Option to earn Qantas points. Min 30% deposit required. Borrow up to $750,000.

  • Offset Home Loan

    • Fixed
    • Owner Occupier
    • Principal & Interest
    • LVR <70%
    Interest rate
    6.25 % p.a.
    Fixed 3 years
    Comparison rate
    6.42 % p.a.
    Initial monthly repayment
    $3,079
    Go to site

  • Fixed Rate

    • Owner Occupier
    • Principal & Interest
    • <80% LVR
    Interest rate
    6.59 % p.a.
    Fixed 3 years
    Comparison rate
    7.06 % p.a.
    Initial monthly repayment
    $3,190

    Enjoy up to $3000 cashback for eligible first home buyers and $2000 cashback for refinancers on eligible home loans with the ANZ Fixed Rate Home Loan. Get the security of repayment certainty with a competitive locked in rate. No ongoing fees to pay. Offset account on 1-year fixed loans ($10/month fee applies). Interest-only payments allowed.

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* WARNING: This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan. The comparison rate displayed is for a secured loan with monthly principal and interest repayments for $150,000 over 25 years.

** Initial monthly repayment figures are estimates only, based on the advertised rate. You can change the loan amount and term in the input boxes at the top of this table. Rates, fees and charges and therefore the total cost of the loan may vary depending on your loan amount, loan term, and credit history. Actual repayments will depend on your individual circumstances and interest rate changes.

^See information about the Mozo Experts Choice Home Loan Awards

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