Commonwealth Bank delays its forecast for an interest rate cut, delivering a dire warning to Australian borrowers.

Commonwealth Bank of Australia (CBA) economists have revised their projections for the timing of a potential cash rate reduction by the Reserve Bank of Australia (RBA). Initially, CBA stood alone among the big four banks in anticipating a rate cut in September. However, with inflation showing insufficient decline, interest rate reductions are now not expected until November or possibly even 2025.

Contrary to a recent warning by a prominent economic forecaster suggesting the RBA might need to raise the cash rate thrice this year, Gareth Aird, CBA’s head of Australian economics, indicated that the bank foresees the cash rate remaining unchanged.

Aird stated, “The near-term risk leans towards an interest rate hike. However, we anticipate the RBA maintaining the status quo over the next six months due to the ongoing contraction of the economy on a per capita basis, the further projected decline in inflation, and expectations of a loosening labor market.”