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NAB boss reveals if bank will pass on a future RBA interest rate cut in full

Andrew Irvine predicts the Reserve Bank of Australia could deliver a cut by November.

The new NAB boss has revealed whether the bank will pass on an interest rate cut if the Reserve Bank of Australia (RBA) made the call. Mortgage holders are eagerly awaiting what the RBA will decide next week, however, they've been warned not to expect a cut for a while after recently released inflation figures showed there's still work to be done.

NAB's Andrew Irvine predicts the RBA could give some home loan relief as early as November. The banking chief said NAB would likely deliver that in full for its customers.

"I think when we price our products from a cash rate perspective, whether they go up or down, we would not hold things back," he explained to 9 News.

NAB's boss Andrew Irvine next to RBA Governor Michele Bullock
NAB's boss Andrew Irvine said inflation will dictate what the bank will do but it will likely follow whatever the Reserve Bank of Australia decides. (Source: 9News/Getty)

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"But I think it's going to be a while before they start coming down. It all depends on what happens with inflation."


Irvine said inflation is proving to be "stubborn" at the moment but he doesn't expect interest rates will go up this year.

That would be welcomed relief after a leading economic forecaster issued a dire warning last week that the RBA could be forced to increase the cash rate three times this year.

"Our view as a bank is that we won't see rates go up, hopefully, that gives some comfort to people but it will still be a while until we see them come down, our guess is maybe November but that could easily turn into February," Irvine added.

Irvine's prediction is in line with other mainstream suggestions of what will happen this year. Here's what the big four banks think the RBA will decide in 2024:

  • Commonwealth Bank (CBA): One cut in 2024 with the first in November

  • Westpac: One cut in 2024 with the first in November

  • NAB: One cut in 2024 in November

  • ANZ: One cut in 2024 in the fourth quarter

CBA was originally predicting an RBA rate cut in September, however, it adjusted its forecast because inflation isn't falling fast enough.

It originally suggested three 0.25 percentage point cuts this year, but is now only factoring in one.

“The near‑term risk sits with an interest rate hike. But we expect the RBA to be on hold over the next six months given the economy is still contracting on a per capita basis, inflation is forecast to fall further, and the labour market is anticipated to loosen,” CBA’s head of Australian economics, Gareth Aird, said.

The central bank is set to meet on May 6 to determine the cash rate. Rate City research director Sally Tindall told Yahoo Finance it's unclear what they'll decide.

“What these cash rate forecasts tell us is that no one, not even the RBA knows what its next move is,” Tindall said. “While we’ve made excellent progress bringing down inflation, there’s every chance this next leg of the battle could be the hardest."

Reserve Bank Governor Michele Bullock maintained the central bank “cannot rule anything in or out” and Tindall said there would be signs in the May meeting if an interest rate rise could come this year.

“The RBA is not going to revert back to hiking the cash rate without plenty of data on its side, and plenty of warning to borrowers. However, if you’ve got a mortgage, it’s prudent to plan for a hike just to be on the safe side,” she said.

A new study has revealed how many people across the country are already struggling with the current cash rate of 4.35 per cent as well as the cost of living.

Compare the Market survey discovered almost a quarter of homeowners are worried they’ll have to sell or have already sold due to current conditions.

“Many people’s savings buffers have been depleted, and now they’re struggling to meet repayments,” Compare the Market Economic Director David Koch said. “But a forced sale is really the last resort – most homeowners will fight tooth and nail to hold onto their properties.

“We know tax cuts are coming in July, which should provide some relief. A predicted cash rate cut is hopefully underway in the second half of this year too.

“When interest rates fall, property prices are tipped to increase — so that’s something homeowners should be aware of as well."

He said borrowers need to be proactive and make sure they're on the lowest rate possible.

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