RBA Rate Hike Forecasts: What Borrowers and Savers Should Watch

As of October 30, 2026, Australia’s official cash rate is 4.60%—and another increase is being forecast, not yet decided. The Reserve Bank of Australia (RBA) raised its target by 0.25 percentage points in September, effective September 30. Several major-bank economists now expect another 0.25-point rise in November, which would take the target to 4.85%. For homeowners, that could mean higher variable mortgage payments; for savers, it could mean better deposit returns, although banks do not have to pass on the same increase.

The practical question is not simply whether the RBA will raise rates. It is how much room your household budget has if your lender changes its rate—and whether your savings account offers a competitive return.

Why another RBA cash rate hike is being forecast

The RBA’s cash-rate history shows four increases during 2026, taking the target from 3.60% at the end of 2025 to 4.60% in September. In its September 29 decision statement, the RBA pointed to persistent inflation, higher energy prices and pressure on the economy’s productive capacity. It also said further increases remained possible if needed.

New inflation data has sharpened that concern. The Australian Bureau of Statistics reported on October 28 that consumer prices were 4.3% higher in September than a year earlier, while annual trimmed-mean inflation was 3.6%. Both readings were above the RBA’s 2%–3% inflation target range.

After that release, NAB revised its forecast on October 28 to a November rise of 25 basis points. Commonwealth Bank economists also moved to a hike forecast, and Westpac reaffirmed its November increase call. These are forecasts by economists, not advance announcements from the RBA. Weaker demand or other new evidence could still affect the Board’s decision.

The next decision is scheduled for Tuesday, November 3, 2026, at 2:30 p.m. in Sydney, Australian Eastern Daylight Time (AEDT, UTC+11:00), equivalent to 3:30 a.m. UTC on November 3. The timing is published in the RBA’s official calendar.

A hypothetical household: what an extra 0.25 points could cost

Illustrative example only: Suppose Alex and Sam have a $600,000 principal-and-interest mortgage with 25 years remaining. Their current variable rate is 6.00%, and they keep $50,000 in an ordinary savings account earning 4.50% annually. These are assumed figures for calculation, not a real customer, lender quote or market-average claim.

If the RBA raises its cash rate by 0.25 percentage points and their lender passes that increase on in full, their mortgage rate would rise from 6.00% to 6.25%. Using a standard monthly amortization calculation and assuming the remaining term stays at 25 years:

The mortgage change is roughly $1,106 more over 12 months at the new scheduled payment. The potential savings gain is $125 per year before tax, but only if the savings provider also passes on the entire increase and the balance stays constant. Actual results differ with daily balances, compounding, repayment frequency, loan features, fees and when each bank applies a new rate. The savings gain does not automatically cancel out the mortgage increase.

What a rate rise means for different borrowers

Variable-rate mortgage holders

A lender may raise its variable rate after an RBA hike, but the amount and effective date are set by the lender. Some loans recalculate scheduled repayments; others may initially keep payments unchanged while more money goes toward interest. Check your lender’s notice and repayment schedule rather than assuming the RBA’s decision changes your payment that day.

Fixed-rate borrowers

An existing fixed rate ordinarily stays unchanged during its contracted fixed period. The bigger risk can come at expiry, when the loan moves to a variable revert rate unless you arrange another option. Refinancing or ending a fixed contract early can trigger break costs. Australia’s government-backed Moneysmart guide to fixed and variable loans explains these trade-offs.

First-home buyers and people refinancing

Higher interest rates can reduce borrowing capacity and increase the repayments used in affordability assessments. Compare the actual interest rate, comparison rate, ongoing fees, features and flexibility of competing loans. A slightly lower headline rate is not necessarily cheaper overall.

What savers should—and should not—expect

Higher cash rates can support better savings and term-deposit offers, but the relationship is not automatic. Banks decide their own deposit rates. An account advertising a strong bonus rate may require regular deposits, a minimum balance or restricted withdrawals; introductory rates may expire. Check the ongoing rate and conditions, not just the promotional headline.

For Alex and Sam, the assumed $50,000 balance might earn more after a hike, but that extra $125 gross is conditional. They should also compare the value of keeping cash in an eligible mortgage offset account: reducing mortgage interest may be more valuable than earning taxable savings interest, depending on the loan, account fees and their circumstances.

Use Moneysmart’s savings-account checklist to compare accounts. For deposit safety, the Australian Prudential Regulation Authority explains that eligible Australian-dollar deposits are protected under the Financial Claims Scheme up to $250,000 per account holder per authorized deposit-taking institution, subject to its rules. Different brands can share one banking license.

Five practical checks before the November decision

1. Stress-test repayments. Calculate your mortgage payment at today’s rate, 0.25 points higher and 0.50 points higher. Use the Moneysmart mortgage calculator with your own balance and remaining term.
2. Check your loan type and notices. Record your variable rate, the fixed-rate expiry date if applicable, and any lender-announced changes.
3. Keep an accessible cash buffer. Make sure ordinary bills and unexpected expenses remain covered before locking extra money into a term deposit or committing it to additional mortgage payments.
4. Compare savings rates and offset features. Look at rates after introductory bonuses end, account conditions, fees and the effect of any mortgage offset.
5. Talk to your lender early if repayments may become difficult. Ask about hardship assistance or available changes before missing a payment.

What to watch next

The November 3 RBA decision will settle whether another increase actually occurs. Borrowers should then look for their lender’s rate announcement and effective date; savers should wait for their bank’s deposit-rate update rather than assuming a matching rise. Inflation releases and RBA communications will shape expectations beyond November, but no forecast is a guarantee.

This article provides general information, not personal financial advice. All example figures are hypothetical, denominated in Australian dollars and rounded for readability.