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      Reserve Bank of Australia Set to Raise Cash Rate to Highest Level Since 2011

      The Reserve Bank of Australia (RBA) is anticipated to increase its cash rate by 25 basis points to 4.60% during its upcoming meeting on September 29, 2026. This adjustment would mark the highest cash rate since late 2011 and represents the fourth hike of the year, bringing the total tightening in 2026 to 100 basis points. A recent Reuters poll indicated that 33 of 34 economists expect this move, reflecting a significant shift in sentiment from just a month ago when most anticipated the RBA would maintain its current rate.

      The RBA's decision comes amid persistent inflationary pressures, with core inflation holding at 3.6% in July, exceeding the bank's target of 2% to 3%. Economists have noted that the RBA may be growing impatient with inflation levels, prompting the need for further tightening. The economic growth rate has also outpaced the RBA's sustainable estimate of around 2%, raising concerns about additional price pressures in the economy.

      Most economists predict that the cash rate will remain at 4.60% through the end of December 2026, although a minority foresee a potential increase to 4.85%. The upcoming decision and the accompanying statement from RBA Governor Michele Bullock will be crucial in determining whether the market views 4.60% as a peak rate or a temporary stop in the tightening cycle.

      © 2026 KLEA News. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

      Source: KLEA News

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