RBA raises the cash rate to 4.60%, its fourth increase of 2026, a day before inflation jumped to 4.0%

The Reserve Bank of Australia raised its cash rate target by 25 basis points to 4.60% on Tuesday 29 September 2026, effective 30 September. It is the fourth increase of 2026, and reports of the decision said all nine members of the Monetary Policy Board voted in favour. Our preview set out what the Board faced.

What the Board said

The statement said that "since the previous meeting, some of the upside risks to inflation are materialising." In August the Board had held at 4.35% and said it was prepared to raise the rate "if upside risks materialise" (report); the September statement says those risks have started to materialise.

The guidance changed with it. August's wording was that the Board would do what it considers necessary to bring inflation back to target, "including increasing the cash rate target further if upside risks materialise." September's reads: "The Board will continue to do what it considers necessary to bring inflation sustainably back to target, including increasing the cash rate target further if needed." The condition tied to upside risks has gone.

A decision made without the newest data

The Board decided a day before the Australian Bureau of Statistics published August's consumer prices. Annual inflation rose to 4.0% from 3.5% in July, driven by automotive fuel and housing, while trimmed mean inflation held at 3.6% (report). The labour force report of 24 September had shown unemployment rising to 4.6% in August, with all of the net job gain in part-time work (report).

What it means for the Australian dollar

The RBA's 4.60% is now above the top of the Federal Reserve's target range of 3.75%–4.00%, which it raised on 16 September (report). The Australian dollar is also sensitive to Chinese demand for commodities and to global risk appetite (commodity currencies explained). How interest rate decisions move currencies explains why changed guidance can matter as much as the move itself. Live prices: AUD/USD.

What happens next

The minutes of the September meeting are due on 13 October at 11:30 am AEDT. The ABS publishes September's monthly CPI on 28 October, and the Board's next decision is on 3 November, with the quarterly Statement on Monetary Policy.