RBA Cash Rate Increased To 4.85%

The Reserve Bank of Australia increased the cash rate by 0.25 percentage points to 4.85% on 3 November 2026, up from 4.60%. Six Board members voted for the increase, while three voted to hold.

Why Did The RBA Increase The Cash Rate In November 2026?

The RBA increased the cash rate because inflation remains too high and is now expected to take longer to return to target. The Board judged that another increase was needed despite a slowing economy, falling housing prices and rising unemployment.

The main reasons behind the decision were:

• Inflation is taking longer to fall. The RBA now expects inflation to reach the top of its 2–3% target range in late 2027, around nine months later than previously forecast.
• Price pressures remain widespread. Inflation remains high across many goods and services. Businesses report rising costs, with many increasing prices or planning to do so.
• Higher fuel costs are flowing through to other prices. The Middle East conflict continues to put upward pressure on oil and energy prices, adding to costs across the economy.
• Domestic capacity pressures are tighter than expected. The economy’s ability to meet demand remains constrained, while AI-related investment is driving rapid price growth for technology-related goods.
• The Board is concerned about inflation expectations. Some measures have risen, increasing the risk that households and businesses come to expect persistently higher inflation.

The RBA has not committed to another increase or a hold. Its next decision will depend on incoming data and how the outlook for inflation and the economy develops.

Our Experts Take On The Board's Decision

Here is what our experts say about the cash rate decision and what it means for borrowers.

Another rate rise puts more pressure on borrowers, but buyers should weigh the purchase price alongside the interest rate. A lower price could help offset higher borrowing costs. You may be able to refinance if rates fall, but you can’t renegotiate the price after settlement.

For current homeowners, the pressure is real. Before deciding to sell, weigh the costs of selling and renting against what you can realistically afford. Whether buying or holding, make sure the repayments work today, without relying on future rate cuts.

Jonathan Preston, Senior Mortgage Broker

A lot of my clients are asking how to buy their next home before selling their current one. Life does not wait for the perfect rate. If a move is on your mind, it is worth finding out what is possible before you decide anything.

Ajar Rajbhandari, Mortgage Broker

What Could The 0.25% Cash Rate Rise Mean For Your Mortgage?

A higher RBA cash rate does not automatically change your mortgage rate on the same day. Your lender decides whether to change its variable rates, by how much and when the new rate takes effect.

If your lender passes on the full 0.25-percentage-point increase, your variable interest rate could increase by the same amount. The effect on your repayment will depend on your outstanding loan balance, remaining term, repayment type and current interest rate.

Use the RBA Cash Rate Change Calculator below and enter +0.25% to estimate the change to your monthly repayment.

5 Things To Do After The RBA Increased Cash Rate On November 2026

• 1. Check your lender’s response and calculate your new repayments Confirm how much your lender is increasing your rate and when it takes effect. Use the new interest rate to calculate your repayments; don’t add the percentage increase to your repayment amount.
• 2. If you’re buying, weigh the property price against the higher rate Recheck your borrowing power and budget. A lower purchase price could help offset higher borrowing costs, so compare the actual numbers before deciding to wait. Make sure you can afford the loan without relying on future rate cuts.
• 3. If you need to move, check how you could finance it A rate rise doesn’t put life on hold. Ask your broker about buying before selling, bridging finance or selling first, including the costs and repayments if your current home takes longer to sell.
• 4. Ask for a better rate and check your alternatives Request a rate review from your lender, then compare alternatives, including fees and features. If you originally needed a specialist loan, improved finances or credit history could give you more options.
• 5. Get help early if repayments are becoming difficult Speak with your lender or broker before missing repayments or deciding you need to sell. Review your budget and available support. Lower repayments through a longer loan term or temporary interest-only arrangement can mean paying more interest overall.

How The RBA Cash Rate Affects Interest Rates

Lenders add a margin to the official cash rate to determine the variable interest rate they offer to customers.

When the RBA raises the cash rate, lenders often increase their variable interest rates. This means your mortgage repayments go up.

When the RBA cuts the cash rate, lenders may lower interest rates. So, your repayments could go down. However, note that not all lenders pass on the full change.

If the cash rate is unchanged, your repayments usually stay the same. However, lenders can still change rates for other reasons.

Use our rate change calculator to find out what your repayments should look like whenever the cash rate changes.

Upcoming RBA Monetary Policy Board Meeting Calendar 2026

Source: rba.gov.au