Business · Economy · 1 hr ago
Australia raises cash rate to 4.85%, highest since 2008
The Reserve Bank of Australia raised its cash rate to 4.85%, a quarter-point increase and its fifth this year.
The rate is now at its highest level since 2008.
The bank is trying to bring inflation under control as the global oil shock linked to the Middle East war adds to price pressures.
It expects inflation to stay above 3% for most of 2027.
More than 3.3 million households with home loans face added pressure as repayments are affected by higher rates.
The decision was not unanimous: six board members supported the increase and three preferred to leave rates unchanged.
The bank gave no explicit signal of another increase, so its next move remains uncertain.
Australia’s Reserve Bank raised its cash rate target by 0.25 percentage points to 4.85 per cent.
The rate is at its highest level since late 2008, and the increase is the fifth in 2026.
The board’s decision was split, with six members voting to raise rates and three voting to hold them steady.
The bank said inflation is now expected to remain high through much of 2027.
The rate increase is intended to help bring inflation back towards the bank’s target.
- Who
- The Reserve Bank of Australia raised its cash rate target.
- What
- It increased the target by 0.25 percentage points, to 4.85 per cent.
- When
- Tuesday, November 3, 2026.
- Where
- Australia.
- Why
- The bank is trying to bring inflation back to target and limit the risk that inflation expectations rise.
RBA board members who voted to raise rates
RBA board members who voted to hold rates
Rate decision
RBA board members who voted to raise rates
Voted to increase the cash rate target by 25 basis points to 4.85 per cent.
RBA board members who voted to hold rates
Voted to leave the cash rate target unchanged at 4.60 per cent.
RBA deputy governor Andrew Hauser warned that some businesses were considering 3 to 3.5 per cent inflation the new normal.
The RBA raised its cash rate target by 0.25 percentage points to 4.85 per cent.
- Cash rate target
- 4.85 per cent
- Rate increase
- 0.25 percentage points
- Board vote
- Six members voted to raise rates; three voted to hold
- Number of rate rises in 2026
- Five
- Inflation outlook
- Expected to remain high through much of 2027
8 sources
Closing Bell: RBA pulls the reins, but ASX backs a late winner
RBA interest rates: governor Michele Bullock explains decision to lift cash rate to 4.85% – video
Australia raises rates to highest level since 2008 financial crisis
RBA lifts interest rates for fifth time this year
Breaking: RBA lifts interest rates to highest level in 18 years to try to dampen inflation
Australia Raises Key Rate to 18-Year High in Split Decision
Interest rates at highest since GFC
What people are saying
around three quarters later than previously forecast
The Middle East conflict remains unresolved, and there are scenarios where inflation is higher and activity lower than forecast
That is the central banker's nightmare. We can't allow expectations to shift away from the target