In brief
Australia’s central bank raised its cash rate target to 4.85 % in a 6‑3 vote, marking the highest level since 2008. The decision follows four earlier hikes in 2026 and aims to curb inflation, which the RBA expects to stay above target until late 2027. The move comes amid expectations by markets and media that a raise was likely, and confirms the RBA’s warning about Middle‑East conflict risks.
In Sydney on Tuesday, the Reserve Bank of Australia (RBA) lifted its cash rate target by 0.25 percentage point to 4.85 %, an 18‑year high, following four prior increases in 2026 (Xinhua).
The Monetary Policy Board, which adopted the decision in a 6‑3 majority vote during a two‑day meeting, said the rise is needed to restrain inflation that remains above its 2‑3 % target (Xinhua).
Official data released on Oct. 28 showed annual inflation rose from 4.0 % in August to 4.3 % in September, while trimmed‑mean inflation – a core measure – edged up from 3.5 % to 3.6 % (Xinhua).
Board members warned that the unresolved conflict in the Middle East and rising fuel prices could further pressure prices and growth, with disruptions to global oil supplies continuing to lift energy costs (Xinhua).
The RBA will hold its final meeting of 2026 in early December to consider additional adjustments to the cash rate target (Xinhua).
Prior to the decision, the market had already expected a hike, with analysts at ABC News projecting the 4.85 % level after the release of the inflation figures (ABC). That expectation was confirmed by live updates from SBS and News.com.au after the board vote (SBS; News.com.au).