With some banks already cutting interest rates in anticipation of the Reserve Bank of Australia’s 12 August meeting, four experts from the University of the Sunshine Coast are available to offer insights.
How could a cash rate change impact people, food prices, small business, housing and the economy?
UniSC Senior Lecturer in Finance and Economics Dr Hammad Siddiqi
Expertise: Banking sector, financial markets
“The cash rate needs to be cut. The economy is not doing well, with several head winds. The RBA has historically taken a cautious approach and typically waits for data, which is often slow to arrive. On 12 August, however, a judgement call is needed despite insufficient data.”
UniSC Senior Lecturer in Management Dr Wayne Graham
Expertise: Small business, regional industry
“The cost of living remains a huge challenge for small business owners because it impacts the cost of their supplies and their customers’ ability to purchase products and services, as prices naturally need to increase. Most are doing it tough. “About 60 percent of businesses in Queensland are sole traders, many home-based, so if they’re paying a mortgage or rent, interest rate changes directly affect them. If the RBA reduces the cash rate it will provide relief for those with loans, but housing costs and availability remain big issues.”
UniSC Senior Lecturer in International Business Dr Jane Menzies
Expertise: Global trade, female entrepreneurship, 4-day work week
“The RBA is likely to implement a cash rate reduction, given the decreasing inflation figures – we are now at 2.1 percent inflation rate (July 2025), having come down from 7.8 percent in December 2022.
“This will give further relief to existing mortgage holders and increase consumer spending. It will also impact housing prices due to greater affordability of new mortgage borrowers, which will unfortunately negatively affect first home buyers already struggling to afford their first new home. An interest rate cut will be positive for property investors, but negative for those who are seeking term deposits/online saving accounts."
UniSC Associate Lecturer in Economics Dr Raffaella Belloni
Expertise: labour economics, international economics
“Inflationary pressures have continued to moderate, and the recent increase in the unemployment rate provides further support for the expectation that the RBA will implement a reduction in the target cash rate at its upcoming meeting.
“Such monetary easing would likely offer financial relief to households with mortgage obligations, as lower interest payments would reduce pressure on disposable incomes. This may enable households to reallocate spending from debt servicing toward savings or increased consumption of discretionary goods and services.
“This shift in consumer behaviour could have positive spillover effects for small and medium-sized enterprises (SMEs), particularly in regional areas where many firms are facing economic hardship.”
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