Experts Predict Rate Hike as RBA Seeks to Control Inflation

Borrowers are in for another rate hike as nearly all experts predict an increase in the cash rate, according to Finder's RBA Survey. Of the 41 panellists surveyed, 90% (37/41) expect the Reserve Bank of Australia (RBA) to raise the cash rate on Tuesday, taking it to 4.60%. The majority of those surveyed also believe at least one further hike will occur by the end of 2026, with most predicting a hike in November.

The RBA's move is aimed at controlling inflation, which has been above target for over five years. Dr Shane Oliver, Chief Economist at AMP, said that if the RBA decides to extend its wait-and-see approach, it risks losing credibility on its inflation objective. The cash rate hike would cost the average borrower an extra $427 a month compared to January 2026.

However, not everyone is convinced that rate hikes will be effective in controlling inflation. Adjunct Professor Noel Whittaker from QUT expects a hike but doubts it will work, saying it will hit people with mortgages hard while doing little to address the global forces driving inflation.