Mozo Money Moves: Big banks bet on a rate cut as inflation hits 4 year low, but not all agree

From falling inflation to shifting rate cut forecasts, the money moves were fast this week, and we’re back to cover what’s changed and what economists are now predicting for the Reserve Bank of Australia (RBA) meeting on Tuesday week (8 July).

CBA and Westpac joined NAB in calling for a July rate cut after the latest monthly inflation data showed price growth is cooling faster than expected while lenders continued reshaping their home loan offers. In the savings space, term deposit rates mostly trended down, and personal loan tweaks hinted at some product repositioning. Mozo also reveals our expert picks for the Best Banks of 2025 and the Best Banking App of 2025.

Here’s what happened, and what it means for your money.

Tempting as it is to call it, a cut isn’t locked in.

On Wednesday, Australia’s monthly CPI indicator showed inflation slowing in May. Headline inflation fell to 2.1%, and the trimmed mean (the RBA’s preferred measure which cuts out volatile items) dropped to 2.4%, which was the lowest recorded rate since November 2021. This was enough for CommBank and Westpac to join NAB in forecasting a rate cut at the next RBA meeting on 8 July. 

“A benign monthly CPI print in May and a steady labour market allows the RBA to move the cash rate back to neutral at a relatively swift pace,” said Belinda Allen, Senior Economist at Commbank. “We expect the RBA to cut the cash rate in both July and August which would see the cash rate sit at 3.35%”

Luci Ellis, Chief Economist at Westpac had similar thoughts, but with a note of caution. “We now expect the next RBA rate cut to be in July rather than August, but this is not the shoo-in the market seems to think it is,” she said. “The RBA has sometimes defied market pricing if offshore risks are being over-weighted, but now is the time to bring forward a move it knows it will likely make soon anyway.”

Still, the Reserve Bank might not be ready to move just yet, as Governor Michele Bullock clearly indicated in May the board was hesitant of cutting too quickly and being unable to reverse the consequences. There is also the issue of the fact quarterly CPI data is not released until 30 July, and with electricity and NBN price hikes landing on 1 July, any slowdown in energy prices may prove short lived. 

“Markets love a pivot story,” says Mozo money expert Rachel Wastell. “But the RBA has been more measured than that. I think that a July cut could be on the table, but if it does happen, I would expect that the board’s language will be very cautious, and maybe even reluctant.”

ANZ has also held firm in its original call, forecasting a 25 basis point cut in August, followed by another in February 2026. 

“We continue to expect the RBA to ease 25bp in August 2025 and February 2026, which would take the cash rate to 3.35%,” ANZ Research wrote in its latest weekly update published today. “That said, we would not rule out a more rapid pace of easing to 3.35%, with 25bp cuts in July and August.”

Lenders continue to vie for low LVR borrowers.

With expectations of a cash rate cut building, several lenders moved to adjust their home loan offers this week. Greater Bank revised its cashback tiers for owner occupiers paying principal and interest with an LVR under 80%, now offering $2,500 cashback for loans between $250,000 and $499,999, and $3,000 cashback for loans $500,000 and over. 

Customer-owned bank Easy Street also made moves, launching two new two-year fixed home loan special offers. The special offer for owner occupiers paying principal and interest is now leading in the 2 year fixed category (P&I LVR 80%) with a rate of 4.95% p.a. (5.64% p.a. comparison rate*). 

The new interest-only special offer for investors sits at 5.19% p.a. (5.53% p.a. comparison rate*), placing it second in that category (IO, LVR 80%). Both loans come with a $500 application fee and a $696 discharge fee. 

“This is just more evidence of where the market’s at,” says Wastell. “Banks are prioritising low-risk customers with equity, and most of the sharpest offers are coming from digital lenders, customer-owned banks and non-banks.” 

How much could you save by switching from a Big Four Bank?

“If you’re still sitting on a rate starting with a six, it's time to question your loyalty. If lenders are already adjusting ahead of the RBA, those who move early could pocket the savings sooner.”

“Plus, it doesn’t even take a full percentage point drop to make a big difference, as refinancing from 6.27% to 5.39% could save you $267 a month or a whopping $80,055 over 25 years.”

As term deposits fall into the 3s, a few banks lift their game

At-call savings rates held relatively steady this week, with a few quiet tweaks landing ahead of the RBA’s July meeting. But in the term deposit space, a wave of cuts swept across short and medium-term offers, a signal that many banks are repositioning early and trying to attract short-term depositors.

G&C Mutual Bank cut 0.15% off its 1-year rates, which dropped it down to fourth spot for 1 year term deposits. This leaves Heartland bank as the sole leading provider offering 4.25%p.a.

Great Southern Bank trimmed several of its rates, with 3–9 month terms dropping by 0.10%. The 3-month TD now pays 4.15% p.a. (down from 4.25%), while the 9-month option slid under the 4% mark. Bank Australia followed suit cutting its 3-month term deposit by 0.20% to 4.25% p.a., while HSBC slashed all its 3 to 12 month rates by 0.25% leaving no rate higher than its 3 month at 3.50%p.a. Meanwhile, Central West Credit Union shaved 0.05% off all rates, which meant cutting the 1-year term to just 3.80% p.a. 

BCU Bank also cut 3 month terms by 0.05%, but lifted its 7-month rate from 3.70%p.a. to 4.30% p.a. and added another 0.05% onto the 5 month term. This makes it one of the most competitive offers on the market for that term. While many banks are easing back, BCU’s hike gives depositors a rare chance to lock in a rate starting with 4.

Two other banks hiked shorter terms this week too, with Bendigo increasing its 7-month term by 0.40% and ING hiking 3 and 4 month terms by 0.20-0.25%.

“As banks price in another RBA cut, longer term deposit rates are being reduced, while shorter terms are being increased.”

“Getting ahead of the curve could be the difference between earning decent interest and watching returns erode,” says Wastell.

“The direction of travel is clear, savings rates starting with 3 are the new norm. But not all term deposits are created equal, and the best deals still go to those who compare.”

Leading 1 Year Term Deposits ($25,000 balance)

Credit cards shift and fee waivers on personal loans extended

While credit card and personal loan rates don’t typically move in lockstep with RBA decisions, this week saw a string of subtle changes that suggest some lenders may already be repositioning ahead of the curve.

NAB lifted its late payment fee on credit cards from $15 to $20, a 33% increase that will sting for cardholders who miss due dates. ANZ, meanwhile, quietly increased the minimum spend needed to secure bonus rewards points on its Rewards Platinum card from $2,000 to $3,500. The bonus points on offer were also reduced from 100,000 to 85,000, however to push borrowers to keep these cards for longer and pay at least two annual fees, there was an additional 40,000 points bonus added to the offer, which card holders can collect after 15 months.

On the personal loan front, CommBank pulled back its car loan cashback offer, removing the $500 cashback on its secured fixed personal loan – a benefit that had previously sweetened the deal for CommBank Yello customers. They also extended the establishment fee waiver for other personal loan products from 30 June to 30 September 2025.

Great Southern Bank followed Commbank in further extending its establishment fee waiver for fixed rate personal loans. Borrowers taking out between $5,000 and $75,000 on unsecured loans and those taking out $5,000 to $100,000 on secured personal loans before 30 September 2025 will pay $0 in establishment fees. 

“While we don’t usually see personal loans or credit cards respond directly to RBA moves, the shifts this week suggest some lenders are nudging their offers into a more competitive position,” says Wastell. 

“If a rate cut does land in July, we may see more of this quiet repositioning of offers playing out, particularly from banks trying to get ahead of consumer refinancing behaviour and capture borrowers at fixed rates before rates continue downward.”

Mozo reveals the Best Banks (& Banking Apps) in 2025

This week, Mozo also revealed the winners of the 2025 Mozo Experts Choice Awards for Australia’s Best Banks and the winners of Australia’s Best Banking Apps. Experts awarded the providers delivering exceptional value and those offering outstanding digital experiences to savers and borrowers.

Australia’s Best Banks

Unlike one-off category awards, to qualify for the Australia’s Best Banking awards, banks had to win at least two Mozo Experts Choice Awards in the past 12 months and offer a home loan product. Mozo’s judges assessed the full performance of each provider across 47 different award categories, standardising more than 2,700 product rankings to identify which banks truly stood out for consistency, competitiveness and all-round value.

“While we do recommend consumers shop around to get the best deal for specific financial products, many Australians still prefer the simplicity of banking with one provider,” says Peter Marshall, Mozo Experts Choice Awards Judge.

“For those who prefer to keep all their banking in one place, this winners list really matters, as these are the banks where your loyalty could actually pay off.”

Winners of Australia’s Best Banks 2025:

• Australia’s Best Bank: ING
• Highly Commended: HSBC & Macquarie 
• Best Customer-Owned Bank: People’s Choice
• Best Small Customer-Owned Bank: MOVE Bank
• Best Regional Customer-Owned Bank: RACQ Bank
• Best Credit Union: Police Credit Union
• Best Major Bank: Commonwealth Bank

Check out the full winners list and methodology here or read the media release.

Australia’s Best Banking Apps

This year, Westpac has once again secured the top spot, named Australia’s Best Banking App for 2025 following a rigorous review of 49 mobile banking apps across the country.

“Mobile apps are now the frontline of banking in Australia, and the best providers are those that empower customers with visibility, security and control, all from the palm of their hand,” says AJ Duncanson, Data Director and Mozo Experts Choice Awards Judge.

Best Banking App: Westpac

“The app covers most of the bases you'd look for such as notifications, card management functions and smart merchant identification, but also some less common features such as the ability to re-categorise your transactions," said Duncanson.

"Westpac's app excelled in offering the richest set of features, providing users with superior visibility and control over their banking needs, offering a powerful blend of functionality and innovation."

Highly Commended Apps: ANZ Plus, Commonwealth Bank, Macquarie, Up

“The Highly Commended banking app winners were strong across the board, offering all the essential features and many of the extras, but just fell short of the top spot,” said Duncanson. “They still stand out for delivering great overall value and functionality in the Australian mobile banking app space.”

Check out the full winners list and methodology here or read the media release.

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As a part of Mozo’s commitment to making your money count for more, each month we “roundup” the rate changes, key banking trends and money moves in the Australian personal finance market. 

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