11/08/2026
Interest Rate Update
At its meeting today, the Board decided to leave the cash rate target unchanged at 4.35 per cent.
Financial conditions have tightened in response to three increases in the cash rate target this year. Money market interest rates and government bond yields have risen, and the exchange rate has appreciated. There are signs that consumer spending growth is slowing gradually as expected, while growth in business debt and investment is strong. Momentum in the housing market has shifted, with housing prices falling in some capital cities and new housing loans declining noticeably. Labour market conditions have eased by a little more than expected in recent months. Labour market leading indicators point to only limited easing in the near term.
The disruption to global oil supply is adding directly to inflation and there are indications that higher fuel prices are being passed through to prices of other goods and services, so inflation is likely to remain high for some time. This inflation impulse is in addition to the effect of capacity pressures in the economy.
The Board remains focused on ensuring that high inflation does not become embedded. To achieve this, growth in aggregate demand needs to remain subdued to reduce capacity pressures and bring inflation back to target. Following three increases in the cash rate target since the beginning of the year, financial conditions are now tighter than they were, and the economy appears to be slowing as expected. But inflation is still too high. It is not expected to return to around the midpoint of the target range until late 2027 and there are upside risks to this projection. With monetary policy judged to be somewhat restrictive, the Board decided to leave the cash rate target unchanged while it assesses how the economy is evolving. The Board will continue to do what it considers necessary to bring inflation sustainably back to target, including increasing the cash rate target further if upside risks materialise.
Read the full release
https://www.rba.gov.au/media-releases/2026/mr-26-19.html
