RBA December Decision: Why Borrowers Are Quietly Preparing for 2026 Already

As the RBA heads into its final meeting of 2025, the headlines may focus on whether rates move in December. The real story for borrowers is how banks react around the edges and what that means for anyone with a home loan.

A year of cuts and now a likely pause

If you have been watching every RBA decision this year waiting for rates to suddenly fall back to 2021 levels, you are probably realising that is not how this cycle is going to work.

Three cuts in 2025 have taken the cash rate down to 3.60 per cent. Inflation is cooler, spending is softer and the labour market is less tight, but not weak. Across major news and analyst commentary a few themes keep repeating:

• Inflation is easing overall but still uneven across the economy.
• Services costs like rents and insurance remain stubborn.
• Growth is soft and household confidence is cautious.
• Economists are shifting from “maybe another cut” to “probably a hold”.

In short, things are not bad enough to cut quickly, not strong enough to raise and not clear enough to gamble on. December is shaping up as a watch and wait meeting.

While the RBA pauses, lenders keep moving

The interesting part for borrowers is not the headline decision, it is what banks have been doing around it. Throughout 2025 lenders have continued to adjust pricing even when the cash rate has not moved.

The best rates available today are often very different to the rates many existing borrowers are still paying.

Some lenders passed on cuts quickly, others slowly and some partially. New customer offers have shifted, while many back-book rates have stayed higher. If your home loan has not changed for a while, there is a real chance it has drifted away from the sharper end of the market.

2026 may be a long, sideways stretch

Recent coverage from bank economists and market commentators now points to a longer pause, with the next major shift in the cash rate likely sitting somewhere in 2026, not the next few months.

If that happens, we are heading into a period where:

• Banks focus on competing with each other rather than reacting to the RBA each meeting.
• Some lenders quietly sharpen rates to attract refinancers.
• Others rely on inertia and keep existing borrowers on older rates.
• Decisions about fixed, variable and split structures become more strategic.

The key question is simple. Are you in a position where doing nothing still works in your favour, or are you sitting on a rate that has not kept pace with the options now available in the market?

What proactive borrowers are asking

(General information only, not financial or credit advice.)

Rather than try to second guess the RBA, proactive borrowers are focusing on clarity. Common questions include:

• Has my lender fully passed on the recent cuts?
• What are new customers being offered compared to what I am on?
• Is my loan structure still suited to where rates and my life are heading?
• Am I paying for features I do not use?
• What would a different rate or structure mean for my repayments over the next few years?

These are not simple DIY calculations. They are the kind of questions that usually prompt people to seek a clear explanation from someone who works with home loans every day.

Where Compare Your Rates fits in

Compare Your Rates is built to help Australians understand what is happening in the market without jargon, hype or pressure.

We are not a lender and we do not provide credit advice. We do not tell you which loan to choose. Instead, our role is to help you stay informed about:

• What the media is reporting about the RBA and the economy.
• How lenders are moving independently of the cash rate.
• What questions are worth asking if you want to check whether your current loan still stacks up.

If you decide you would like personalised guidance, we can, at your request, introduce you to a licensed mortgage professional who can review your situation and discuss specific options directly with you.

One simple takeaway

The biggest opportunities in 2026 are unlikely to come from surprise RBA moves. They are more likely to come from the decisions borrowers make between those moves.

If your home loan has not been reviewed since rates began to fall in 2025, it may be worth checking whether you are still in line with today’s market. Staying informed and asking the right questions can make a real difference over time.