The RBA cash rate history: every change since 1990

The Monetary Policy Board sets the cash rate target at its eight scheduled meetings each year. The cash rate is the interest rate on unsecured overnight loans between banks². The cash rate target is the level the Monetary Policy Board sets for it at each of its meetings⁶. The Reserve Bank says the cash rate strongly influences other interest rates and forms the base of the interest-rate structure in the economy.

The objectives behind each decision are set by law. Under the Reserve Bank Act 1959, as amended in 2024, the Reserve Bank's overarching objective is to promote Australia's economic prosperity and welfare, while monetary policy is directed at price stability and the maintenance of full employment in Australia⁶. Since the early 1990s, those objectives have found practical expression in a target for consumer price inflation of 2–3 per cent a year. The Reserve Bank dates the earliest references to this approach to speeches by the then Governor in August 1992 and in March and August 1993.

Since February 2024, the Board has met eight times a year rather than monthly, over two days, with the outcome announced at 2.30 pm on the second day⁷. The Governor holds a media conference after each meeting to explain the decision⁶. Before December 2007, the Reserve Bank issued a media release only when the target was changed².

How changes in the cash rate flow through to what banks charge business borrowers is covered in the business loan interest rate statistics.

The published cash rate series ranges from a high of 17.00 to 17.50 per cent to a low of 0.10 per cent. The longest hold lasted 1,036 days at 1.50 per cent, while the largest single-value moves were one percentage point.

The series opened at the 17.00 to 17.50 per cent range on 23 January 1990. The highest single-value target was 14.00 per cent, effective 2 August 1990, and the highest level since 2000 was 7.25 per cent, held from March to September 2008². The series does not cover the period before 23 January 1990.

The 0.10 per cent target took effect on 4 November 2020.² It was announced as part of a wider pandemic package: the same decision cut the target for the yield on the three-year Australian Government bond to around 0.1 per cent, cut the Term Funding Facility rate to 0.1 per cent, and announced the purchase of $100 billion of government bonds⁸. The 0.10 per cent target stayed in place for 546 days, until an increase took effect on 4 May 2022².

The 1.50 per cent target remained unchanged for 1,036 days, or about 34 months, between a cut effective 3 August 2016 and a cut effective 5 June 2019. The second longest lasted 595 days at 7.50 per cent from December 1994. The third longest is a tie. The holds at 2.50 per cent from August 2013 and 0.10 per cent from November 2020 each lasted 546 days².

There were 11 one-percentage-point cuts: eight between August 1990 and May 1992, and three between October 2008 and February 2009.² There were two such increases, in October and December 1994. Since February 2009, no single change has been larger than 0.50 percentage points. Five changes reached that size: a cut effective 2 May 2012, and the four consecutive increases of June to September 2022.

The tables below record every change to the cash rate target at its effective date, the day the new target applied, which is the day after the announcement. Positive changes are increases and negative changes are cuts, in percentage points. January to July 1990 entries record range targets. Decisions that left the target unchanged are not shown².