What happened
The Reserve Bank of Australia kept the cash rate target unchanged at 4.35 per cent following three rate increases earlier this year. The board noted that trimmed mean inflation remains elevated and headline inflation is too high. Aggregate demand growth must remain subdued, with inflation not expected to reach the target midpoint until late 2027.
Why it matters here
For Australian investors and mortgage holders, the pause confirms policy remains restrictive after three rate hikes earlier in 2026. Higher borrowing costs continue to weigh on consumer spending and housing loan volumes, while persistent inflation risks leave open the possibility of further tightening if domestic capacity pressures or global energy costs re-accelerate.
What to watch
The Reserve Bank Monetary Policy Board's next interest rate review on 29 September 2026, alongside updates on domestic monthly inflation figures and labor market indicators.
Source
rba.gov.au