RBA Holds at 4.35%: Good News for Novated Lease Buyers?
The RBA kept rates at 4.35% in June 2026. Here's what a rate hold actually means if you're considering a novated lease — plain English, no spin.
The Reserve Bank's Monetary Policy Board held the cash rate steady at 4.35% on 16 June 2026, according to the Treasury Ministers media release. Treasury described it as "a welcome reprieve" given ongoing global volatility — conflict in the Middle East, rising rates in other economies, and persistent cost-of-living pressure at home.
For most Australians, a rate hold means the mortgage pain doesn't get worse — but it doesn't get better either. If you're already stretched, that context matters when you're thinking about any new financial commitment, including a novated lease.
What this means for novated lease customers
Novated leases are funded through third-party lenders, and the rates those lenders charge are influenced — directly or indirectly — by the RBA cash rate. A hold, rather than a cut, means lease finance rates are unlikely to drop in the near term. That's worth factoring into your timing if you're weighing up whether to lease now or wait.
The flip side: the tax benefits of novated leasing don't move with the RBA. The pre-tax salary packaging structure, and the FBT exemption on eligible electric vehicles introduced under the Treasury's EV policy settings, remain unchanged. For PAYG employees, those potential savings on income tax and GST exist regardless of what the RBA does — which is what makes novated leasing worth considering even in a higher-rate environment.
Treasury also flagged in the same release that the recent Budget included cost-of-living relief measures — tax cuts, cheaper medicines, fuel excise reductions — all of which affect your take-home pay and therefore what a novated lease actually costs you net. The Budget bottom line matters here: your post-tax cash position is the real number to run against any lease scenario.
Common questions
Does the RBA cash rate directly affect my novated lease rate?
Not directly, but lender funding costs track the broader rate environment over time. A rate hold means no immediate upward pressure on lease finance rates, but cuts aren't on the table either. Your actual lease rate depends on the lender and your employer's arrangement.
Does the RBA decision change the FBT exemption for electric vehicles?
No. The FBT exemption for eligible EVs is a legislative tax setting, not tied to monetary policy. It remains in place under current Treasury policy settings regardless of RBA decisions.
Is now a bad time to take out a novated lease given high rates?
It depends on your personal situation. The pre-tax savings from salary packaging can offset some of the cost of higher finance rates — but you should model both sides. millarX can run the numbers against your specific salary and vehicle choice.
How do the Budget's tax cuts affect my novated lease value?
Tax cuts increase your take-home pay, which can change the relative benefit of pre-tax packaging. In some cases, a higher marginal rate gives you more tax benefit from novated leasing — it's worth reassessing your position after any tax change.
What does 'cost-of-living pressure' mean for my leasing decision?
If your disposable income is squeezed, it's worth stress-testing the lease repayment against your actual budget — not just the tax saving. A novated lease should make financial sense even if rates stay elevated for longer.