Industry groups and lenders say the decision to hold gives borrowers and small businesses a clearer window to act
The decision of the Reserve Bank of Australia (RBA) to hold the cash rate at 4.35% has drawn measured responses from across the mortgage and finance industry, with lenders and industry bodies encouraging borrowers and brokers to use the pause to review their positions rather than wait for further clarity.
The Mortgage & Finance Association of Australia (MFAA) welcomed the hold, saying it provided a degree of stability in an environment where cost of living pressures and shifting economic conditions had prompted many Australians to defer borrowing or investment decisions.
"Certainty matters when people are making significant financial decisions," said Anja Pannek (pictured top left), chief executive of the Mortgage & Finance Association of Australia. "We have seen households, investors and businesses taking a more cautious approach as they consider the direction of interest rates, the economic outlook and the broader policy environment."
Pannek said the decision did not point to a single course of action for all borrowers. "For some Australians, the right decision may be to buy, refinance or invest," she said. "For others, it may be to wait. What matters is having the information and confidence to make a decision that is right for your individual circumstances."
She stressed that mortgage and finance brokers had a significant role to play in supporting clients through that process, noting that the channel facilitated a record 81% of all new residential home loans in the March 2026 quarter.
Mortgage Choice chief executive Anthony Waldron (pictured top centre) said the hold was consistent with softer inflation data published by the Australian Bureau of Statistics the previous month, but cautioned that the prospect of another rise could not be dismissed. "Inflation remains sticky enough that the possibility of another cash rate rise this year can't be ruled out," he said.
Waldron advised borrowers to treat the pause as an opportunity to act rather than stand still. He noted that roughly one in three Mortgage Choice home loan submissions in July were for refinancing, and pointed to softening home values — down for four consecutive months according to PropTrack data — as creating openings for prospective buyers who were ready to move.
Roberto Sanz (pictured top right), general manager of sales and partnerships at small business lender Prospa, said the hold gave small business owners greater certainty, though he warned the underlying picture for many operators remained tight. He cited YouGov research commissioned by Prospa showing that SME confidence in staying cashflow positive had fallen from 70% to 60% since February, with average cash reserves sitting at just 2.6 months.
"A steady rate gives brokers a reason to check in now, help clients reassess their position, and put the right funding options on the table before they are needed," Sanz said.
The RBA's decision followed three consecutive rate increases between February and May. Most major bank economics teams expect the cash rate to remain on hold for an extended period, though interbank futures pricing pointed to a 60% probability of a further rise by March 2027. Rate cuts are not expected before the second half of 2027 at the earliest, according to forecasts from the big four banks.
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