04/02/2026
At its first meeting of 2026, the Reserve Bank of Australia (RBA) has lifted the cash rate by 0.25 percentage points, taking it to 3.85%. This marks the RBA’s first cash rate increase since November 2023 and reflects ongoing concerns about rising inflation.
The Consumer Price Index (CPI) rose to 3.8% in the 12 months to December, up from 3.4% in November.
The RBA’s goal is for inflation to sit “sustainably” within its target range of 2 to 3%, preferably around the midpoint making the increase widely expected by the major banks.
Today’s cash rate hike could place additional pressure on household budgets, with around 1.3 million households potentially experiencing mortgage stress. A 0.25 per cent increase could add roughly $115 to the monthly repayment on an average $694,000 mortgage.