Will Interest Rates Go Up Next Week?

The Reserve Bank of Australia’s next cash rate decision is due on 29 September 2026, and expectations have shifted significantly since the RBA held the cash rate at 4.35% in August.

Inflation remains above target, global energy prices have risen again and the RBA is becoming more concerned that some of the inflation risks it warned about in August are now materialising.

At the same time, all four major banks now expect the RBA to increase the cash rate by 0.25 percentage points to 4.60% in September. Home Loan Experts brokers who provided predictions for this update are also leaning towards another increase.

A rate rise is not guaranteed. The RBA will receive more labour-market data before the meeting, and it is still weighing the effect of the three rate rises already delivered in 2026.

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Will The RBA Raise Interest Rates In September 2026?

Home Loan Experts’ brokers who provided their views for this update both expect another rate rise.

Jonathan Preston, Senior Mortgage Broker

Jonathan Preston expects the RBA to raise the cash rate.

He is monitoring financial market expectations as well as global supply and energy risks. Jonathan specifically highlighted disruption to Saudi exports, market pricing indicating a higher likelihood of another increase and the interest-rate yield curve as signals supporting his view.

Jonathan also expects another increase to put further pressure on market sentiment.

For borrowers already concerned about cashflow, his view is that it is worth considering available loan structure options before repayment pressure becomes harder to manage. Depending on the borrower, that could include discussing whether fixing part or all of a loan is appropriate, or whether an interest-only period could provide temporary cashflow relief.

These options have trade-offs. Fixed loans can provide repayment certainty but may restrict flexibility and can involve break costs. Interest-only repayments can reduce repayments temporarily, but the principal does not reduce during the interest-only period, and total interest costs can be higher.

Sheng Ye, Mortgage Broker

Sheng Ye also expects the RBA to increase rates and agrees with Jonathan’s overall outlook. Sheng expects market conditions to remain challenging in the near term before improving.

The more practical question for borrowers, however, is not only whether the RBA will increase rates, but what another 0.25% or 0.50% increase would mean for their own repayments and borrowing position.

Our RBA cash rate change calculator lets you enter your current loan balance, loan term and interest rate to estimate how your repayment could change after a rate movement.

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Why Is A September Rate Rise Looking More Likely?

1. Underlying Inflation Is Still Above Target

Annual headline CPI eased from 3.8% in June to 3.5% in July 2026.

However, trimmed mean inflation, which can provide a clearer indication of underlying price pressures, remained at 3.6%.

That is unchanged from June and remains above the top of the RBA’s 2-3% inflation target range.  

Fuel is also becoming a concern again.

Automotive fuel prices rose 7.5% in July, after falling during the previous three months. The ABS attributed the increase to higher world oil prices and the partial unwinding of the Federal Government’s fuel excise relief.

2. The RBA Says Some Inflation Risks Are Materialising

This may be the most important change since the August meeting.

In August, the RBA said it was prepared to increase the cash rate again if upside inflation risks materialised.  By 18 September, Governor Michele Bullock said some of those risks appeared to be materialising.

The RBA is particularly concerned about:

• Higher oil and energy prices
• Businesses passing increased input costs on to customers
• AI-related investment adding to demand and pushing up prices for supply-constrained technology
• Domestic capacity pressures
• Persistently weak productivity growth

The RBA has also said that higher input costs becoming embedded in broader price and wage setting could require a stronger monetary policy response.

3. Oil Prices Have Become A Bigger Inflation Risk

Global oil prices have risen sharply as the conflict in the Middle East has intensified.

CBA said Brent crude had moved from around US$100, raising the risk that higher petrol and diesel costs will flow through to Australian inflation. This was one reason CBA brought its expected RBA increase forward from November to September.

The RBA has also highlighted both the direct effect of higher petrol prices and the indirect effect as businesses pass transport and other input costs through to consumers.  

4. Household Demand Has Not Collapsed

Higher interest rates are slowing parts of the economy, but some recent spending data have remained relatively resilient.

Household spending rose 1.1% in current-price terms in July, following increases in May and June. Some of that increase reflects higher prices, so the figure should not be interpreted as pure volume growth.

GDP increased 0.4% in the June quarter and 2.1% over the year. The ABS described overall economic growth as subdued, but the economy has not contracted.  

This leaves the RBA trying to slow demand enough to reduce inflation without creating an unnecessarily sharp slowdown.

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Big Four Banks Predict RBA Cash Rate

There has been a significant shift in major bank forecasts over the past month.

Bank	September forecast	Forecast cash rate after September	Further 2026 increase?
CBA	+0.25%	4.60%	Further increase remains a risk
Westpac	+0.25%	4.60%	Possible
NAB	+0.25%	4.60%	Risk tilted towards another rise
ANZ	+0.25%	4.60%	Expects +0.25% in November

The important point is not that the major banks are guaranteed to be correct. Forecasts change as new information arrives.

What has changed is the degree of consensus: all four are now expecting an increase at the September meeting

Commonwealth Bank: September Rise To 4.60%

CBA now expects the RBA to increase the cash rate by 0.25 percentage points in September, taking it to 4.60%.

It previously expected the RBA to increase the cash rate in November 2026.

CBA says higher oil prices, stronger-than-expected economic data and increasingly hawkish communication from the RBA led it to bring the forecast forward. It also says another increase after September remains a risk.  

>Westpac: September Rise To 4.60%

Westpac has also moved its forecast from November to September.

Chief Economist Luci Ellis said recent RBA communication had shifted sufficiently for a September increase to become Westpac’s base case.

Westpac still sees a risk of another increase if inflation remains elevated and economic data surprises on the upside.

NAB: September Rise To 4.60%

NAB has expected a September increase since the July CPI result.

Its forecast is for a 25-basis-point increase to 4.60%, with the risk tilted towards an additional increase in November if economic activity remains resilient.  

ANZ: September And November Rises

ANZ currently has the most aggressive forecast of the four major banks.

It expects a 0.25-percentage-point increase in September, followed by another 0.25-percentage-point increase in November, bringing the cash rate to 4.85% if both increases occur.

ANZ cited persistent inflation concerns and the renewed Middle East conflict as factors behind the change.

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Could The RBA Still Hold The Cash Rate?

Yes.

There is still a credible case for leaving the cash rate at 4.35%.

The RBA has already increased rates three times this year, and monetary policy works with a lag. Governor Bullock said in September that the full impact of those increases is yet to be felt.

There are also signs that parts of the economy are softening.

Housing conditions have weakened, new housing lending has declined, and the RBA says household spending growth is moderating. July’s unemployment rate was 4.5%, with employment falling by about 16,000 people during the month.

At its August meeting, the Board explicitly considered both a 0.25-percentage-point increase and a hold before unanimously choosing to leave rates unchanged. Members judged there was still time to assess whether existing monetary tightening was sufficient.

The September decision, therefore, comes down to whether the Board believes the inflation risks have strengthened enough to justify acting now rather than waiting for more data.

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What Could Another Rate Rise Mean For Home Buyers?

The most immediate consideration is borrowing capacity.

Lenders assess an applicant’s ability to repay a loan using an interest rate above the actual rate being offered. If mortgage rates rise, that assessment can become more restrictive.

This means someone who qualified for a particular loan amount several months ago may not necessarily qualify for exactly the same amount after rates change.

If you already have a pre-approval, it can therefore be useful to have your borrowing position checked again before making an unconditional offer or bidding at auction.

The deposit you have saved has not changed simply because the RBA moves rates, but the amount a lender is prepared to lend and the repayment you feel comfortable making can change.

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What Should Mortgage Holders Do Before The RBA Announcement?

There is no need to restructure a home loan simply because an RBA meeting is approaching.

But the week before the decision is a useful time to understand your numbers.

For example, consider running your mortgage through the Rate Change Calculator using both a 0.25% and 0.50% increase. That gives you a clearer idea of the buffer available in your household budget before you know what the RBA or your lender will actually do.

It is also worth checking the interest rate you are currently paying. A borrower on an uncompetitive rate may have opportunities to request better pricing or refinance regardless of whether the RBA moves in September.

For borrowers already experiencing repayment pressure, Jonathan Preston says fixed repayments or an interest-only structure could be options worth investigating in some circumstances.

Neither is automatically the right solution. A broker can explain the lending implications and costs of different loan structures, while financial, tax or legal advice should come from the appropriately qualified professional where relevant.

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Should You Fix Your Home Loan Before The RBA Raises Rates?

The prospect of further cash-rate rises can make fixed rates more attractive because they provide certainty about repayments for the fixed period.

But the decision should not be based only on predicting the RBA.

When comparing fixed and variable options, consider factors such as:

• The fixed rate available now
• The length of the fixed period
• Whether extra repayments are restricted
• Whether an offset account is available
• Potential break costs
• How much repayment certainty matters to you
• Whether you expect to sell, refinance or make major changes during the fixed period

Another option for some borrowers is splitting a loan between fixed and variable portions.

The appropriate structure depends on the borrower’s circumstances rather than on a single rate forecast.

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Should You Wait Until After The RBA Meeting To Refinance?

Not necessarily.

If your current rate is materially higher than other options available to you, waiting for the RBA does not guarantee a better outcome. You can talk to an expert about what a refinance can do for you.

Lenders can also change mortgage rates independently of the RBA, and fixed rates, in particular, can move as wholesale funding costs and financial market expectations change.

A more useful comparison is between: what your existing loan costs you now and what suitable alternatives cost you now, including any refinancing fees.

Then, separately, consider how each option might respond if rates rise again.

What Happens If The RBA Raises Rates In September?

• If the Board increases the cash rate by 0.25 percentage points, the target would move from 4.35% to 4.60%.
• Variable rate borrowers would then need to watch their lender’s announcement to see whether the increase is passed through and when the new rate takes effect.
• Borrowers on fixed rates generally would not see their fixed rate change during the agreed fixed period. However, the rates available when that period expires may differ.
• Prospective borrowers could also face changes to lender pricing and borrowing capacity calculations.

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Could The RBA Raise Rates Again In November 2026?

Yes, although forecasts differ.

ANZ currently expects another 0.25-percentage-point increase in November, which would take the cash rate to 4.85%. NAB and Westpac have identified another increase as a risk, while CBA also says an additional rise remains possible depending on inflation and the Middle East conflict.

Whether another move is needed will depend heavily on inflation, employment, household demand and global energy prices.

The RBA’s next full Statement on Monetary Policy is due in November.

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Review Your Home Loan Before The RBA Decision

A likely August hold could provide borrowers with more short-term certainty, but it does not automatically reduce repayments or make an existing loan more competitive.

Home Loan Experts can review your current loan, compare available options and help you understand how different interest rate scenarios could affect your repayments and borrowing position.

Please call us on 1300 889 743 or enquire online and one of our commercial mortgage brokers will get back to you with some options.

Complete our 360° Home Loan Assessor to get started. It takes about two minutes, requires no login and does not affect your credit score.

This information is general in nature and does not take into account your personal objectives, financial situation or needs. Interest rate forecasts can change as new economic information becomes available.