NAB Calls Next Cash Rate Move a Cut — What Borrowers Need to Know Before June 16

NAB has made a significant shift in its official cash rate forecast, now predicting that Australia's next interest rate movement will be a cut, not a hike. The announcement comes as the RBA prepares for its June 16 board meeting, with markets watching closely for signals from major lenders.

The Current Economic Picture

The RBA's cash rate currently sits at 4.35%, unchanged since May 6, 2026. Key data from the ABS paints a picture of a slowing economy:

NAB's economists argue that slowing economic momentum now outweighs inflation risk, making a rate cut the more likely next step — even with CPI still above the RBA's 2–3% target band.

Why Lenders Are Divided

While NAB is forecasting a cut, other lenders moved in different directions this week. Australian Broker reports that some lenders raised fixed rates while others cut them — a clear sign of deep uncertainty across the market. This divergence underscores why borrowers should not wait for a single "perfect moment" to act.

For non-bank lenders, RBA rate moves influence the cost of wholesale funding. A rate cut would generally support more competitive variable rate pricing.

What This Means for Self-Employed Borrowers

For self-employed borrowers and small business owners — MPFG Capital's core market — the prospect of lower rates has practical implications:

• Serviceability buffers may ease: A 25bp cut typically reduces the stress-test threshold, allowing more applicants to qualify
• Borrowing capacity improves: Lower rates mean lower minimum repayments in serviceability calculations
• Refinancing window may open: Borrowers previously assessed as borderline may become eligible

Key actions before June 16:

1. Review your current borrowing capacity with a specialist lender
2. Do not wait — a rate cut confirmation could shift market conditions quickly
3. Consider that non-bank lenders like MPFG Capital assess applications case-by-case, independent of major bank credit scoring

MPFG Capital's View

Whether rates move up or down on June 16, MPFG Capital assesses each borrower based on their actual financial position — not a one-size-fits-all scorecard. Our Alt Doc and flexible lending solutions are built to work across the rate cycle.

If you've been waiting for the "right time" to apply, the current environment — with potential rate relief on the horizon — may be worth acting on now.

This article is based on publicly available information from NAB, Australian Broker, and the RBA. It does not constitute financial advice. Loan eligibility is assessed individually.