Australia: Reserve Bank Raises Cash Rate to 4.85 Percent in 6-3 Vote, an 18-Year High and Fifth Hike of 2026
The Reserve Bank of Australia's Monetary Policy Board voted six to three on November 3 to raise the cash rate target by 25 basis points to 4.85 percent, effective November 4. It is the RBA's fifth rate increase of 2026 and takes the cash rate to its highest level since 2008; three members voted to leave it unchanged at 4.60 percent.
In its post-meeting statement, the Board said data since the previous meeting have confirmed that underlying inflation remains broadly based, capacity pressures appear a little tighter than previously estimated, and higher fuel prices are being passed through to prices of other goods and services. Inflation is now expected to remain above 3 percent for the coming year, with an increasing risk that higher inflation expectations will become embedded. Updated staff forecasts, published in the November Statement on Monetary Policy, show headline inflation peaking at 4.5 percent at the end of 2026 and not reaching the top of the 2 to 3 percent target range until late 2027, about three quarters later than previously forecast.
Given the revised outlook and continuing upside risks, the Board judged a further tightening warranted to support the return of inflation to target, and said it will continue to do what it considers necessary to bring inflation sustainably back to target while remaining attentive to the data. Governor Michele Bullock told a press conference that high inflation is particularly painful for those on low incomes, which is why getting it down matters, and that the next move in rates is unclear.
Published by GSM · USA (original Chinese edition)
Photo: 照片：澳大利亚储备银行大楼（悉尼），Danausi 摄，Wikimedia Commons，公共领域 / Photo: Reserve Bank of Australia building in Sydney, by Danausi, Wikimedia Commons, public domain
