In March, the RBA pushed the cash rate to 4.10%. The vote was five to four. The four dissenters wanted to hold, not cut. That tells you everything about where we are.

Eighteen months ago, the conversation around mortgage holders was when, not if, rates would come down. Markets were pricing in cuts. Brokers were quietly suggesting clients hold off on refinancing because something better was coming. Then inflation re-accelerated in the second half of 2025, the Middle East situation pushed energy prices higher, and the RBA had no choice but to reverse course. Two consecutive hikes since February. Cuts are not on the table for the foreseeable future.

If you locked into a variable rate hoping for relief, that bet has not played out. If you are reading commentary that suggests rates are about to come down, that commentary is increasingly out of step with what the people inside the RBA are actually saying.

The macro picture, and why it is harder than usual to read

Two things are pulling in opposite directions right now. Domestic demand is still firmer than the Board expected, the labour market is tight at 4.3% unemployment, and trimmed mean inflation is running at 3.3%, well above the 2 to 3 per cent target band. That alone would justify holding rates higher for longer.

Layered on top is a global supply shock. The conflict in the Middle East has driven oil prices up. Energy is a cost input across most of the economy, so higher oil prices feed into transport, food, and just about everything else. That is the textbook definition of a stagflation risk: prices rising while growth slows. The RBA's deputy governor described it openly as a "nightmare" scenario in mid-April. It is not their base case, but it is the risk they are watching.

The honest answer about what comes next is that nobody knows. Three of the four major banks expect the cash rate to hold at 4.10% for the rest of the year. NAB is the outlier, forecasting one more hike. Even the doves on the RBA Board are not arguing for cuts.

What this actually means for your repayments

A 25 basis point increase on a $750,000 variable home loan adds roughly $120 per month. Both the February and March 2026 hikes were passed on in full by the major banks. So if you have a typical variable loan and you have not done anything since the start of the year, you are paying around $240 per month more than you were in January. That is $2,880 a year, after tax.

For an investor with a $1.5 million portfolio split across one home and one investment property, the same hikes translate to about $480 a month, before any deductibility offset. The cashflow squeeze is real, and it compounds.

What is in your control, and what is not

The temptation when rates move against you is to focus on the macro. The war, the inflation print, the next RBA decision. None of which you can do anything about.

The variables you can actually move sit on a much shorter list, and they are the same ones that have always mattered. The volatile rate environment just makes them more valuable.

The rate you are paying right now. Banks do not call you to offer a better deal. The discount they gave you when you signed up has likely eroded. If your loan has not been reviewed in the last twelve months, there is a high probability you are paying 0.3 to 0.5 per cent more than you need to. On a $750,000 loan, that is between $2,300 and $3,800 a year, paid for nothing.

Your loan structure. The split between deductible and non-deductible debt. Whether your offset is being used to its full effect. Whether interest-only or principal-and-interest is right for the asset. These are the structural levers that quietly determine how much interest you pay over a decade. Most clients we sit down with have not had this conversation in years.

Your cashflow buffer. If rates went to 4.35% in May, could you absorb it without dipping into savings? If the answer is no or you are not sure, that is a planning conversation that should happen now, not when the decision lands.

Your behaviour around uncertainty. Two patterns we see consistently. The first is people frozen by uncertainty, refusing to act on anything until they know what rates will do. The second is people making reactive decisions on every news cycle, switching loans, breaking fixed terms, abandoning long-held property strategies. Neither builds wealth. Strategy that survives volatility is built on structure that holds across multiple rate scenarios, not on guessing the next move.

The takeaway

Rate decisions get the headlines. They make people anxious and they make commentators sound certain. But the people who build wealth through a cycle like this one are the people who have already done the work on the things they can control.

Review your loans. Stress-test your cashflow. Know your structure cold. The next RBA decision is on 5 May. By the time it lands, the work that protects you should already be done.