The Reserve Bank has raised the cash rate for the fifth time this year. At 2:00pm Adelaide time (2:30pm AEDT) on Tuesday 3 November, the RBA's Monetary Policy Board lifted the cash rate target by 0.25 percentage points to 4.85%, up from 4.60%. That's the highest cash rate since late 2008. The rise itself was widely expected. What stood out was that the Board was split, with three of its nine members voting to hold. Here's what the RBA said, what it could cost you, and what to do next.
Update, 3:40pm Adelaide time, Tuesday 3 November
The big four banks: as of 3:40pm Adelaide time, CBA, Westpac, NAB and ANZ have not yet announced whether they'll pass on today's rise, by how much, or from when. Savings.com.au still lists all four as "yet to announce", and Aussie's rate tracker shows "no changes announced" for each. Among other lenders, Aussie's tracker shows Macquarie has announced a 0.25% rise effective 19 November. We'll update this article when the big four respond.
Governor Bullock's press conference (3pm Adelaide time), as reported by the ABC:
- She acknowledged the rise isn't what many Australians want to hear, but said "it's what's needed to get inflation down". "Inflation is too high, and our forecasts suggest it will stay higher for longer."
- On fuel: "we are not tightening monetary policy because of the direct impact of oil prices on inflation."
- On what's next: "I don't know what the next move will be." With "five interest rate increases in the system" and "the last couple" yet to flow through, she said it is "probably a good point to just take stock for a minute" and see whether the data track the forecasts.
- The Board will be "watching very closely" because there is "still a bit of a skew on the upside to inflation risks".
The short version
- The cash rate target rose by 0.25 percentage points to 4.85%, effective Wednesday 4 November. It's the fifth rise of 2026, after February, March, May and September.
- The decision was not unanimous: six members voted to raise and three voted to hold at 4.60%.
- The RBA's updated forecasts have inflation not reaching the top of its 2–3% target until late 2027, about three quarters later than it expected a few months ago.
- On a $600,000 loan, Canstar estimates this rise adds about $92 a month, and about $456 a month across all five rises this year, if lenders pass it on in full.
- When we published, none of the big four had announced their response. The RBA gave no signal either way about what comes next. Its next decision is on Tuesday 8 December.
The decision
In its statement, the Board said it had decided "to increase the cash rate target by 25 basis points to 4.85 per cent". According to the RBA's cash rate history, the rate has now gone up by a full percentage point this year, from 3.85% after the first rise in February to 4.85% now. The Board held in June and August.
The ABC notes the cash rate hasn't been this high since late 2008. Rates may be back at 2008 levels, but loans are much bigger now. Canstar puts the average new owner-occupier loan at about $731,000, compared with about $254,000 in November 2008. So each 0.25% rise costs borrowers a lot more in dollars than it did back then.
Very few people were surprised. Going into the meeting, a Reuters poll had 31 of 32 economists, including all four major banks, expecting this rise. Our morning article covered what was expected and how the housing market looked going into the meeting.
Why the split vote matters
The RBA publishes how its Board voted. This time the statement says the decision "was by majority: six members voted to increase the cash rate target by 25 basis points to 4.85 per cent; three members voted to leave the cash rate target unchanged at 4.60 per cent."
A third of the Board wanted to hold. That doesn't change what you'll pay from here, but it does suggest the bar for another rise is fairly high. The three who voted to hold may have wanted more time to see how the earlier rises are affecting households. Without the split, the statement's tougher language on inflation would read as a stronger hint of more rises to come. For now, it's a closer call than it looks.
Why the RBA raised rates
The statement mostly comes down to inflation running hotter, and for longer, than the RBA expected:
- "Inflation remains elevated and recent data indicate that it is broadly based. The inflation outlook has also been revised materially higher in the updated staff forecasts."
- Inflation "is not expected to reach the top of the 2–3 per cent target range until late 2027, around three quarters later than previously forecast."
- "Inflation is now expected to remain above 3 per cent for the coming year and there is an increasing risk that higher inflation expectations will become embedded."
- "Given the revised inflation outlook and the continuing upside risks, the Board judged that a further tightening in financial conditions is warranted."
The RBA linked part of the problem to higher fuel and commodity prices from the conflict in the Middle East. It also pointed to price rises for technology-related goods driven by AI investment, and to firms passing on their own rising costs. It said capacity pressures in the economy look "a little tighter than previously estimated".
The Board also acknowledged the other side. "The economy is slowing, housing prices have fallen significantly and the unemployment rate has risen," the statement said, adding that "higher interest rates and falls in housing prices and turnover are expected to weigh on growth in dwelling investment and household consumption." We covered October's fall in home values in our 2 November article.
What it could cost you
Canstar's modelling shows how much a 0.25% rise adds to minimum monthly repayments, and the total across all five rises this year:
| Loan size (start of 2026) | This rise (November) | Total across five rises in 2026 |
|---|---|---|
| $500,000 | +$77 a month | +$380 a month |
| $600,000 | +$92 a month | +$456 a month |
| $700,000 | +$107 a month | +$532 a month |
| $800,000 | +$123 a month | +$607 a month |
| $900,000 | +$138 a month | +$683 a month |
| $1 million | +$153 a month | +$759 a month |
Canstar's assumptions: an owner-occupier principal and interest loan with 25 years remaining in February 2026, at the RBA's average variable rate, with each rise passed on in full the following month. The figures are changes to minimum repayments. Your own numbers will depend on your rate, balance and loan term. These figures match the table in our 28 October article, which was a scenario at the time. It has now happened.
Not everyone will feel it the same way. According to the same Canstar analysis of the banks' latest results, between 12% and 15% of big four mortgage customers have no repayment buffer: CBA 15%, Westpac 14%, NAB 14% and ANZ 12%. If you're already ahead on repayments or have money in an offset account, that buffer will help absorb the increase.
What the banks are doing
When we published, none of the big four had announced their response. Savings.com.au listed CBA, Westpac, NAB and ANZ as "yet to announce". All four had forecast this rise. See the update at the top of this article for the latest. After September's rise, they passed it on in full within days, and CBA's change took effect on 9 October. Our 1 October article covered how that played out.
Update, Wednesday 4 November: Macquarie (from 19 November) and Teachers Mutual Bank's five brands (from 12 November) have confirmed 0.25% p.a. rises to their variable home loan rates. See who has passed on the rise so far, and when it could hit your repayment.
Lenders don't all move on the same day, and the start date for your loan may differ from the announcement date. Our 8 October explainer covers how the timing usually works.
What it means for you
- On a variable rate? Expect your lender to announce its change within days and apply it a week or two later. Your repayment may not change straight away, because some lenders adjust it at your next scheduled review. Check your banking app, or ask your lender, so you know the new amount and when it starts.
- On a fixed rate? Nothing changes until your fixed term ends. If you roll off in the next six to twelve months, start planning now. The jump from an older fixed rate to current variable rates could be large.
- Buying with a pre-approval? A 0.25% rise can reduce how much a lender will offer you. Have your pre-approval rechecked before you bid or sign anything.
- Thinking about refinancing? If your repayments are going up again, it's worth checking whether your rate is still competitive. Keep in mind that lower property values can push your loan-to-value ratio up, which affects the rates you can get.
- Feeling squeezed? Talk to your lender early, before you miss a repayment. Hardship options exist. The free National Debt Helpline is on 1800 007 007.
What comes next
The RBA didn't promise a pause, and it didn't signal another rise either. The statement says only that the Board "will be attentive to the data and the evolving assessment of the outlook and risks to guide its decisions."
Economists are divided. Before the announcement, CBA said it expected the RBA to lift rates to 4.85% "before remaining on hold until 25bp cuts in August and November 2027". NAB's chief economist, Sally Auld, told the ABC that November's rise was the last one in NAB's forecast. But she also said "it is possible we might see more interest rate rises in the next few months", and that "we are in for a period of reasonably elevated rates for a while yet." We looked at whether 4.85% could be the peak in our 1 November article.
Governor Michele Bullock's press conference was scheduled for 3:00pm Adelaide time (3:30pm AEDT), after this article was written. Watch for whether she leans towards the Board's tougher view on inflation or towards the three members who wanted to wait.
Key dates
- Wednesday 4 November 2026: the new 4.85% cash rate target takes effect. Watch for lender announcements over the following days.
- Late November: ABS monthly inflation figures for October.
- Tuesday 8 December 2026, 2:00pm Adelaide time (2:30pm AEDT): the RBA's last decision for 2026.
Related reading
- Auction clearance rates just hit their lowest level since April 2020, hours before an expected rate rise (Tuesday 3 November, morning)
- Home values just fell for a seventh straight month, and this downturn is now the fastest in 40 years (Monday 2 November)
- Tuesday's rate rise is almost priced in. The bigger question for your mortgage is whether 4.85% is the peak (Sunday 1 November)
- Today's inflation number could decide a fifth rate rise on Melbourne Cup Day. Here's what to watch, and what it would cost you (Wednesday 28 October)
- Big four banks pass on the full rate rise from 9 October (Thursday 1 October)
- One rate rise, many start dates: when the 0.25% actually hits your home loan (Thursday 8 October)
Are your repayments going up again?
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Sources: 1. Reserve Bank of Australia, "Statement by the Monetary Policy Board: Monetary Policy Decision", media release 2026-30, 3 November 2026: cash rate target up 25 basis points to 4.85%; six members voted to increase, three to leave it unchanged at 4.60%; all quoted statement text (rba.gov.au/media-releases/2026/mr-26-30.html). 2. Reserve Bank of Australia, cash rate target history: effective 4 November 2026 at 4.85%; 2026 rises effective 4 February (3.85%), 18 March (4.10%), 6 May (4.35%), 30 September (4.60%); no change in June and August (rba.gov.au/statistics/cash-rate). 3. Reserve Bank of Australia, Board meeting schedules 2026: Monetary Policy Board 7–8 December (rba.gov.au/schedules-events/board-meeting-schedules.html). 4. ABC News, "RBA lifts interest rates to highest level in 18 years to try to dampen inflation", 3 November 2026: highest cash rate since late 2008; fifth rise in 2026 (abc.net.au). 5. ABC News live blog, 3 November 2026: CBA forecast note; Sally Auld comments to the ABC News Channel; press conference at 3:30pm AEDT (abc.net.au). 6. Canstar, "Higher rates, bigger debt: average borrower faces $456 increase in 2026": repayment table and assumptions; average new owner-occupier loan about $731,000 versus $254,000 in November 2008; big four no-buffer shares (CBA FY26, Westpac FY26, NAB and ANZ half-year results) (canstar.com.au). 7. Canstar, "CBA to hike variable rates by 0.25, stays silent for savers": CBA's September pass-through effective 9 October (canstar.com.au). 8. Savings.com.au, "Cash rate hits 4.85%: CBA, NAB, Westpac and ANZ responses", 3 November 2026: all four "yet to announce" when checked (savings.com.au). 9. investingLive, citing a Reuters poll: 31 of 32 economists expected 4.85%, including the big four (investinglive.com).
General information only, not credit advice.
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