03/11/2026
Persistent inflationary pressures have prompted the Reserve Bank of Australia (RBA) to increase the cash rate by another 0.25 percentage points to 4.85%.
The decision marks the fifth increase for 2026 and takes the cash rate to its highest level since 2008.
Inflation has picked up again, with Australia’s annual headline rate rising to 4.3% in September from 4.0% in August. Underlying inflation was 3.6%. Both measures remained above the RBA’s 2-3% inflation target range.
Fuel prices were part of that rise, jumping 9.4% in September, although they were excluded from that month’s trimmed mean measure of underlying inflation. Housing remained the largest contributor to annual inflation.
Higher borrowing costs are also changing the picture for buyers and sellers. Domain’s September quarter report showed combined capital-city house prices fell 4.7%, the steepest quarterly drop in its records, with every capital recording a decline for the first time in 15 years.
“Homes are taking longer to sell, there is greater scope to negotiate, and sellers are having to be more realistic about price expectations,” said Domain’s chief residential economist Dr Nicola Powell.
For those planning to buy, do contact us for a pre-approval.
The next cash rate decision will be announced 8th December 2026.
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