Australia · RBA decision
29 September 2026: the RBA lifts the cash rate to 4.60%
The fourth rise of 2026. About +$98 a month on an example $600,000 variable loan if passed on in full.
Decision 29 September 2026 · effective 30 September 2026
Newer decision: on 3 November 2026 the RBA lifted the cash rate again, to 4.85%. Read what that means.
At its 28–29 September meeting the Reserve Bank’s Monetary Policy Board raised the cash rate target by 25 basis points, from 4.35% to 4.60%. The decision was unanimous. Read the statement and the minutes.
It was the fourth increase this year, after rises in February, March and May and holds in June and August. The cash rate started 2026 at 3.60%, so it is now a full percentage point higher.
Why the Board moved
In short: inflation is still too high, and some of the risks the Board flagged in August have turned up. In its words, “Inflation remains elevated and some of the upside risks flagged in August are materialising.” The statement pointed to:
- Higher global energy prices as the Middle East conflict broadened. The minutes say domestic petrol and diesel prices were 13 per cent higher than forecast in August.
- Rapid growth in global prices for technology-related goods, driven by demand linked to AI.
- Continued pressure on Australia’s own capacity, with firms reporting cost pressures and passing them into prices.
- Recent Australian inflation outcomes that were stronger than expected.
On the other side of the ledger, the statement noted that housing prices have fallen in most capital cities, new housing loans have declined noticeably, and consumer spending growth is easing. The minutes put the unemployment rate at 4.6 per cent in August.
On what comes next, the Board said it “will continue to do what it considers necessary to bring inflation sustainably back to target, including increasing the cash rate target further if needed.” That is a statement of intent, not a forecast. We do not forecast the next decision.
The variable home loan
On an example $600,000, 30-year principal-and-interest variable loan starting at 6.20% (the RBA’s average outstanding owner-occupier variable rate for August 2026), a full 25-point pass-through takes the repayment from about $3,675 to $3,773 a month: +$98. Paid fortnightly, it is about +$45 a fortnight.
Across all four rises this year (100 basis points), the same example loan would have gone from about $3,388 to $3,773 a month, if every rise had been passed on in full.
Your lender sets the timing and size of any change and will tell you in writing. See the worked maths, or put in your own numbers with the repayment calculator.
Borrowers are under pressure, but most are coping
The minutes include the RBA’s twice-yearly look at financial stability. Scheduled mortgage repayments had risen to around 10 per cent of household disposable income, near their 2024 peak. Even so, the RBA estimated that fewer than 2 per cent of owner-occupier borrowers were facing a cash-flow shortfall, and the median borrower held savings buffers worth roughly one to two years of repayments, depending on income. Those are averages. If your own budget is tight, your lender has hardship options and the free National Debt Helpline (1800 007 007) can help.
Savings and fixed loans
Banks set savings and term deposit rates, and many lift them after a rise, sometimes only partly or after a delay. Compare what your bank actually pays with what it advertises. Existing fixed-rate loans do not change until the fixed period ends.
Next meeting
The Board next met on 2–3 November 2026 and raised the cash rate to 4.85%. See our note on that decision.
General information only. It does not take your objectives, financial situation, or needs into account and is not financial advice. Example loans are illustrations, not quotes.
Sources: RBA media release 2026-27, 29 September 2026; Minutes of the Monetary Policy Board meeting, 28–29 September 2026; RBA cash rate target table; RBA Statistical Table F6, Housing Lending Rates (series FLRHOOVA), August 2026; RBA board meeting schedules.