Cairns Economic Monitor - September 2025
At the recent Chartered Accountants Regional Forum in Cairns, we gained both a national perspective from NAB and local insights from Regional Development Australia and Cairns Regional Council. The overall mood was upbeat, with strong demand continuing to drive growth. Yet, one challenge dominated the conversation: the high cost of construction, which remains the biggest obstacle to new development.
While stakeholders are working hard to unlock opportunities and meet the region’s housing needs, relief on costs looks unlikely without interest rate cuts or a cooling in trade demand. Encouragingly, building approvals in Cairns have been trending upward for more than a year. But to make a real dent in the accommodation shortage, we will need to see higher and sustained numbers.
On the monetary policy front, the RBA delivered the expected August cut, lowering the Cash Rate by 25 bps to 3.6%. With inflation projected to ease back into the 2–3% target range, markets are anticipating another cut before year-end and possibly one more in early 2026, bringing the rate down to 3.1%. However, July’s hotter-than-expected inflation reading could change that outlook.
Closer to home, the labour market is showing early signs of softening. Cairns’ trend unemployment rate edged up to 4.7% in July. Even so, solid full-time employment and strong participation suggest the local jobs market remains in healthy shape.