RBA August 2026: Will Australia's Cash Rate Rise Again?

Industry experts are split on the RBA's August call after three rate rises in 2026 — here's what brokers and lenders are predicting.

Australian Broker reports that market players are more divided than they have been in years after three rate increases in 2026 left borrowers and lenders navigating a significantly more expensive credit environment. With the Reserve Bank of Australia's August monetary policy meeting fast approaching, the question facing every variable-rate borrower is simple: is there more pain to come?

As things stand, the official cash rate (OCR) sits at 4.35%. The RBA raised rates three times in 2026 before opting to hold in June, stating it needed more time to assess how those hikes were flowing through the economy. Since that decision, the economic data has kept coming — and not all of it has eased the pressure.

Why the August Decision Is So Hard to Call

Several competing forces are pulling the RBA's next decision in different directions, which is why well-informed people can be found firmly on both sides.

Grant Arbuckle, managing director of Melbourne-based Loan Studio, is in the hike camp. "I think the RBA will hike in August, another 25 basis points," he told Australian Broker. His reasoning centres on the inflation data. Trimmed mean inflation — the RBA's preferred underlying measure — rose from 3.4% to 3.6% in May. Shorter-run momentum measures are also picking up. Critically, the fuel excise cut that has been softening headline inflation is due to expire at the end of July — the same week the board meets.

"The thing that seals it for me is the second-round effects," Arbuckle said. "Services prices are starting to rise off the back of energy costs, which is exactly what the RBA said it was worried about in the June statement. When a central bank tells you what would force its hand — and then the data serves it up — I take them at their word."

On the other side, Darren Liu, founder and managing director of Sydney-based FinStreet, believes a hold is more likely. "The RBA has already delivered three rate increases this year, and the full impact of those increases is still working its way through household cash flows, borrowing capacity and business conditions," he said. In his view, the board has reason to allow more time before tightening further. That said, he acknowledges that if inflation proves more persistent, another rise "remains a genuine possibility."

Ryan Gair, CEO of non-bank lender Rate Money, echoes that caution. He believes the RBA "may want more time to assess how those higher borrowing costs are flowing through households and businesses before making another move."

Belinda Sugars, a franchise owner and mortgage broker at Mortgage Choice in South Australia, is leaning the other way. She points to economists at major banks who share the hike view, noting that inflation "is still not where the RBA wants it to be," and that the threat of another rise has made many of her clients "very cautious and holding off on purchasing."

Robert Sordillo, founder and managing director of Adelaide-based Significant Financial Solutions, sits in the hold camp but stresses the path is narrow. "The most likely outcome at the upcoming RBA meeting is that the cash rate will remain unchanged," he said, while noting the RBA "may raise rates again if inflation remains persistent."

What Happens to Your Mortgage From Here

Wherever you fall in the debate, the practical reality for borrowers is the same: you're in an environment where another rate rise is a live possibility and where rates could stay elevated for longer than many expected.

For variable-rate borrowers, an August hike means repayments climb again. If you haven't stress-tested your budget against a further 25 basis point increase, use the repayment calculator to run those numbers before the decision lands.

Liu points to an interesting feature of the current market: despite the rate environment, housing demand hasn't collapsed. "Higher rates have reduced borrowing capacity and placed pressure on household budgets. But this has not translated into a broad housing downturn," he said, citing population growth, chronic housing undersupply and strong demand for well-located property as structural supports.

For borrowers who took on debt at lower rates and are feeling the squeeze, the question of refinancing is live. Use the refinance savings calculator to see whether switching to a more competitive rate could reduce your monthly outgoings — that comparison is worth running regardless of what the RBA does in August.

What to Watch Before the Board Meets

Markets will focus on two things ahead of August: the June quarter CPI data and the RBA's pre-meeting communication. If trimmed mean CPI comes in above expectations, the case for a hike gets stronger. If it eases, the hold camp gains ground.

The fuel excise expiry is a known complication — headline inflation will mechanically rise around the time the board meets, even if the underlying trend hasn't worsened. The RBA has signalled it looks through these mechanical effects, but language on inflation persistence will be closely watched.

What the breadth of views across the industry makes clear is that the era of predictable monetary policy has passed. Sticky inflation, rising wages, low unemployment and global uncertainty have combined to make every RBA decision genuinely contested — even for those closest to the market.

In an environment where rates could move either way, knowing your position is critical. Use the borrowing power calculator to understand what the current and a potential higher rate environment does to your borrowing capacity, or compare the cheapest home loans available to make sure you're not paying more than necessary heading into August.

Read the full rate debate at Australian Broker