How does the cash rate influence your interest rate?

The Reserve Bank of Australia (RBA) is the central bank responsible for maintaining economic stability. The cash rate is the interest rate banks pay to borrow money from each other overnight, and it serves as the base rate for the entire economy. Every six weeks, the RBA meets to decide whether to raise, lower, or keep the cash rate the same. Changes in the cash rate impact how cheaply banks can borrow money, affecting mortgage rates. While the cash rate sets a base influence, banks ultimately set their charges based on regulations, profit, and market conditions.

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