The Reserve Bank of Australia (RBA) has today increased the cash rate by 0.25 percentage points to 4.85%, the fifth increase this year.
Inflation has moved further from the RBA’s 2–3% target range, with headline inflation rising to 4.3% in the year to September 2026, up from 4.0% in the year to August 2026. Underlying inflation also remains above target, with trimmed mean inflation at 3.6% in the same period.
Higher fuel prices are a key driver, with fuel costs rising 9.4% (month-on-month) in September 2026 alone on the back of higher global oil prices. Housing remains the largest contributor to inflation, with the cost of building new homes and electricity prices both continuing to rise. In the same period, unemployment rose to 4.7%, the highest level since 2021, a sign the jobs market may be cooling.
Before its next meeting in December 2026, the RBA will continue watching inflation, household spending and the labour market closely.
