Interest Rates Will Fall Within the Next 12 Months

I believe Australian interest rates will fall within the next 12 months, despite repeated claims from bank economists that rates will remain on hold.

This view is not based on hope. It is based on economic fundamentals that are already weakening. Unemployment is rising. Underemployment remains elevated. Hours worked are declining. The participation rate is softening. These indicators matter. They always do.

Comparisons with the United States and the United Kingdom are often used to argue rates can stay higher for longer. Those comparisons are flawed. Australia’s mortgage market is very different. We are overwhelmingly exposed to variable rate lending. Rate movements here flow through to households faster and with greater impact.

New Zealand provides a more relevant comparison. Under similar household debt conditions, New Zealand has already begun cutting rates. Historically, Australia tends to follow this path, often with a delay.

The Reserve Bank of Australia has a long history of acting too late in the cycle. When policy responses are delayed, the consequences are predictable. Low income workers, renters, and the unemployed carry the burden first and longest.

Australia’s housing affordability and rental pressures did not emerge suddenly. They are the result of prolonged policy settings and inaction. Practical alternatives to manage interest rates and rental supply have existed for years, yet little has changed.

With 58 years of experience across property, interest rates, and wealth creation, I am confident rate cuts will come. My concern is not whether they happen. It is that they will arrive only after unnecessary economic damage has already been done.

Upcoming Announcements

• 7 January 2026: An announcement regarding proposed legal action relating to Australia’s rental and financial crises.
• 10 January 2026: The release of a modern policy solution to inflation.