The official cash rate hit its current level of 4.35% after the Reserve Bank of Australia (RBA) increased it by 25 basis points at its November 2023 meeting. The cash rate's level has held steady since then, and now the bank has met for the last time in 2024, it is a certainty that there will be no cuts until at least 2025.

Recent, better-than-expected jobs data shows that employment rose by 3.1% in Australia in this past year, with the employment participation rate rising to a record high of 67.2%. Betashares chief economist David Bassanese said that these healthy employment numbers will "comfort" the RBA, and will likely mean that cuts are not yet imminent.

Speaking to the Australian Financial Review, Bassanese said that the jobs figures mean the RBA can "continue to wait for a decent decline in inflation before cutting rates, rather than being forced into cutting rates due to weakness in the economy."

Economists at the big four banks maintain their predictions that we will see rate cuts, and agree that these are likely to happen towards the middle of 2025, with the consensus view favouring a cut in May.

With this in mind, those with a mortgage are probably wondering how long they may have to wait for an answer on rates. The bank's board will announce its next cash rate call on Tuesday February 18, 2025, but in the mean time, here's what the big four banks are forecasting.

When do the big four banks think rates will go down?

ANZ: Mid 2025

At this stage, ANZ economists believe that the cash rate has peaked at its current level of 4.35%, and while they originally predicted a February rate cut, they now anticipate that the first cuts are likely to occur around May of 2025.

Commonwealth Bank: Early 2025

Commonwealth Bank economists believe that the cash rate has peaked at its current level of 4.35%, and they say the first cut is likely to occur around February of 2025.

NAB: Mid 2025

NAB economists predict that the current level of 4.35% will be the cash rate's peak, and initially predicted that the first cut was likely to occur in May of 2025. While the bank briefly moved its prediction up to February 2025, it now once again predicts a rate cut in May.

Westpac: May 2025

Westpac economists predict that the current level of 4.35% will be the peak of the cash rate, and that we might expect the first rate cuts to occur around May 2025. While the bank briefly moved its prediction up to February 2025, it now once again predicts a rate cut in May.