RBA Boosts Cash Rate to 4.60%, Highest Since 2011
The Reserve Bank of Australia (RBA) increased its cash rate target by 25 basis points to 4.60%, the highest level since October 2011, in a move that was widely anticipated.
This is the RBA's fourth rate hike in 2026 and follows a pause in May when it held rates steady at two consecutive meetings.
The RBA emphasized that inflation pressures remain elevated, with some of the upside risks flagged at the August meeting now materializing. The board voted unanimously for the hike, citing global energy prices significantly above assumptions used in August forecasts, driven by the Middle East conflict and AI-related demand.
The statement also noted that domestic capacity remains under pressure, with liaison surveys indicating that businesses are experiencing cost pressures and have either raised or are considering raising prices for goods and services. Short-term inflation expectations remain elevated, and recent Australian inflation data has come in above expectations from the previous meeting.