Reserve Bank of Australia lifts cash rate to 4.85%, highest since 2008

The Reserve Bank of Australia raised its cash rate on 3 November 2026, from 4.6% to 4.85%, its fifth rise of the year, The Guardian reported. The cash rate is the central bank's benchmark interest rate, and it influences what households and businesses pay to borrow. The Guardian said the rate is now at its highest level since 2008.

The decision was not unanimous. Six members of the bank's monetary policy board voted for the increase, while three voted to hold the rate where it was. The bank published its statement on the decision as media release 2026-30.

The move comes as inflation remains above the bank's target. Australia's inflation was 4.3% in the year to September 2026, and the Reserve Bank aims to keep it within a range of 2% to 3%. The bank forecast that inflation would return below 3% by the end of 2027.

For borrowers, the effect is measurable. More than 3.3 million Australian households have home loans. Canstar, a financial comparison service, estimated that the November rise adds $107 to the monthly payment on a $700,000 home loan. It said the five rate rises in 2026 together add $532 to repayments on the same loan.

The bank's forecasts also cover the wider economy. It expects growth of 1.6% in 2026 and 1.3% in 2027. Unemployment was 4.7% at the time of the decision, and the bank forecast it would reach about 4.9% by the end of 2027 before rising above 5% in 2028.

The rise follows a September increase to 4.6%, the fourth hike of 2026, which Reuters reported was a 15-year high at the time. Before the November meeting, the ABC had reported that the board was widely expected to lift the cash rate to 4.85%.