SYDNEY — The Reserve Bank of Australia raised its cash rate target by 25 basis points to 4.85% on Tuesday, Nov. 3, the bank said in a statement by its Monetary Policy Board.
It was the fifth rate rise of 2026 and took the cash rate to its highest level since 2008, SBS News reported.
Key facts
- The board voted 6-3: six members backed the increase and three voted to hold at 4.60%, the RBA said.
- The bank does not expect inflation to reach the top of its 2–3% target range until late 2027, about three quarters later than it forecast before.
- Australia’s unemployment rate reached 4.7% in September, its highest in five years, SBS News reported.
Why the bank moved
Inflation remained elevated and broadly based, the board said. Higher fuel and commodity prices tied to the conflict in the Middle East were part of the reason, it said.
Domestic capacity pressures were also judged to be a little tighter than earlier thought, the statement said.
“Inflation is too high and our forecasts suggest it will stay higher for longer,” RBA Governor Michele Bullock told reporters, according to SBS News.
The board said the economy was slowing, housing prices had fallen significantly and unemployment had risen.
Reaction
Treasurer Jim Chalmers said the decision was “widely expected, but that doesn’t make it any easier for Australian families and businesses to absorb,” SBS News reported.
Canstar estimated that a borrower with a $500,000 loan could pay about $77 more a month, SBS News reported.
Related coverage
- Oceania News: Australia, New Zealand and the Pacific
- Bank of England Raises Rates to 4% in First Hike Since 2023
Sources
- Reserve Bank of Australia, “Statement by the Monetary Policy Board: Monetary Policy Decision,” Nov. 3, 2026
- SBS News, “RBA’s Cup Day call takes rates to 18-year high,” Nov. 3, 2026
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