What happened
Commonwealth Bank economists have brought forward their forecast for the Reserve Bank of Australia's next interest rate increase from November to September 2026. The bank now expects the Monetary Policy Board to announce a 25 basis point lift in the cash rate target at its meeting on 29 September.
Why it matters here
A rate increase before October accelerates borrowing cost pressures across the economy, directly impacting mortgage holders and equity market valuations. Higher interest rates typically raise funding costs for listed Australian companies and increase competition for yield-bearing assets, making defensive positions more attractive relative to high-multiple growth equities.
What to watch
The Reserve Bank of Australia board delivers its cash rate announcement on Tuesday, 29 September, following its two-day monetary policy meeting.
Source
commbank.com.au