The cash rate has been sitting at 4.35% since the RBA held steady in June, after three increases earlier in 2026. Westpac’s latest view is that recent RBA communications have sounded more cautious on inflation than many borrowers may have hoped. Its economists are watching the June quarter Consumer Price Index, due on 29 July, as the key piece of evidence before the RBA board meets on 10-11 August.

For households considering a mortgage refinance, the message is not to panic, but to prepare. A forecast is not a decision, and Westpac has also signalled it is less certain about a follow-up September hike than it was previously. However, the fact that one major bank is still expecting more tightening shows why waiting passively for rate relief can be risky.

The practical issue is repayment resilience. A further 0.25 percentage point rise may not sound large, but on a sizeable home loan it can tighten monthly cash flow quickly, particularly for borrowers who have already absorbed multiple rate moves, rising insurance costs, council rates and everyday living expenses. It may also affect borrowing capacity for those hoping to access equity, consolidate debts or move to a sharper loan.

Refinancers should use the next few weeks to check three things. First, compare their current rate with new-customer offers, not just with their lender’s advertised standard variable rate. Second, review the comparison rate, fees, offset account value and redraw conditions, because the cheapest headline rate is not always the cheapest loan. Third, stress-test repayments at a higher rate before committing to a new structure.

This is also a useful time for modelling repayments under different scenarios: staying put, refinancing to a lower variable rate, splitting between fixed and variable, or making extra repayments while household income allows. Even if the RBA holds in August, borrowers who complete a loan health check may still find savings available through lender competition.

Westpac’s forecast does not guarantee another rate rise. But it does reinforce a simple refinancing principle: borrowers who know their numbers, understand their options and act before pressure builds are usually in a stronger position than those forced to react after repayments change.