Bank boss warns interest rates may not come down until 2025

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Australians could be facing another year without interest rate relief, the head of Commonwealth Bank has warned.

CEO Matt Comyn told the Australian Financial Review that “persistent” inflation, including in the US, meant there was “certainly a possibility” rate cuts could be delayed.

CBA’s own economists have predicted the Reserve Bank of Australia will maintain the current cash rate of 4.35 per cent until September, and begin to reduce them then.

New US inflation data showed it had fallen from 3.4 to 3.1 per cent in January, but the drop was not as large as economists forecast, the Review said.

“(Rate cuts) will be data-driven and, clearly, inflation coming down should be the highest priority,” Comyn said.

“There is some uncertainty about exactly when rates will come down and what the pace of the reductions might be.”

This month, the Reserve Bank opted to keep the cash rate on hold but governor Michele Bullock warned “the job’s not done”.

“The inflation rate still has a ‘4’ in front of it. It’s fair to say the board does understand that people are doing it tough,” Bullock said.

“And a big reason for that is inflation. That’s why it’s really important we get inflation down.”