Australia's Big Banks Unite in Rate Hike Forecast

Australia's largest mortgage lenders have collectively shifted their stance on interest rate hikes. The Reserve Bank of Australia (RBA) is now expected to lift the cash rate to 4.6% before the end of 2026, according to forecasts from Westpac, NAB, CBA, ANZ, and Macquarie.

The sudden change in outlook follows the Australian Bureau of Statistics' (ABS) July inflation print, which showed headline inflation easing to 3.5% but trimmed mean inflation holding steady at 3.6%, above the RBA's 2-3% target band.

NAB was the first to revise its call on August 27, anticipating a 25-basis-point increase to 4.6% later this month. Westpac, which had previously held a no-further-hikes position, reversed its stance on September 8, citing growing evidence of a more resilient household sector and a larger-than-expected impetus from the data centre boom.