RBA September Rate Hike Back on the Table
A CBA economist says September is now a 'live option' for another hike as oil prices surge to $108 a barrel, ahead of the 28-29 September RBA meeting.
The September Reserve Bank of Australia meeting, scheduled for 28 and 29 September, has shifted from a near-certain hold to what CBA economist Harry Ottley this week called a "live option" for another interest rate rise. If the RBA does move, borrowers already dealing with a cash rate of 4.35 per cent would be looking at even tighter monthly budgets heading into the final months of 2026.
Why the September Hike Risk Has Jumped
Two developments this week sharpened market anxiety about the timing of the next rate move.
The first is a significant surge in global oil prices. Crude oil closed at approximately $101.21 USD a barrel in the week of 9 September, surged to $107.63 the following day, and by 15 September had climbed to $108.75 USD a barrel — well above the $90 mark seen in July. Energy costs feed directly into household budgets, business operating costs and, ultimately, domestic inflation.
The second is explicit language from the RBA's own leadership. RBA Chief Economist and Assistant Governor of Economics Sarah Hunter, speaking at the Regional Australia Institute's Regions Rising National Summit in Canberra on Monday, said the ongoing Middle East conflict "hasn't reached a sustainable resolution" and that higher oil prices would make inflationary pressures at home "worse than they already are."
"We do think that risks to inflation right now are skewed to the upside," Hunter said.
That framing matters. It follows Governor Michele Bullock's statement after the August board meeting that "the board will raise rates further if that is what is required to bring inflation down in a timely way." The July Consumer Price Index confirmed inflation remains above target, with headline CPI at 3.5 per cent and trimmed mean at 3.6 per cent, against the RBA's 2 to 3 per cent target range.
Where the Big Four Stand — and Why It Matters for You
Australia's four major banks, plus Macquarie Bank, are all forecasting at least one more rate rise before year-end. The disagreement is purely on timing.
NAB is the most hawkish, tipping a hike at the September meeting itself. ANZ, CBA and Westpac have all forecast November as the more likely move. But CBA's Ottley was candid this week: "Certainly the September meeting now is quite well priced by financial markets, and there's a very real chance that they can increase rates in September."
Westpac economist Illiana Jain explained her bank's November call: the ABS Consumer Price Index for September is due on 30 September — one day after the RBA's September meeting concludes. "The RBA will want to proceed more cautiously," Jain said, giving the board time to see the data before moving.
That sequential timing is worth understanding as a borrower. If the RBA holds in September but September CPI comes in hot, the November meeting becomes even more likely to deliver a hike. Either way, the direction of travel appears set — the question is whether it arrives in four weeks or eight.
Australian Broker's reporting on the rate forecast debate is available directly from the source.
What Borrowers Are Already Experiencing on the Ground
The combination of elevated rates and uncertainty is producing a measurable chill across the market. According to Equifax's Consumer Market Pulse, first-time homebuyer lending fell 20.1 per cent nationally in August, year on year. New home sales fell 10 per cent in August, according to Housing Industry Association data.
Sydney-based broker Andrew Hadjidemetri, director at Australian Financial and Mortgage Solutions Group, described the mood plainly: "There's just not much confidence out there whatsoever." He noted that first-time homebuyer inquiries in his practice are down roughly 30 to 40 per cent from a year ago.
The RBA has already raised rates three times in 2026. With the cash rate at 4.35 per cent and lenders' standard variable rates running materially above that, mortgage holders are already under pressure. Another 25 basis point move adds hundreds of dollars annually to the average loan.
Brisbane-based broker Maryanne Elliott at 360 Mortgage Solutions offered a more measured perspective: her practice remains busy, primarily from refinancing existing clients alongside some first-home buyer activity supported by the Help to Buy scheme. The divergence between broker experiences reflects a market that is stressed but not frozen — and that means opportunities still exist for borrowers prepared to act.
What to Do Before the 29 September Decision
With less than two weeks until the board meets, there are practical steps worth considering.
**Model your repayment buffer.** If you are on a variable rate and your current repayments are already stretched, work out what a further 25 basis point rise means in dollar terms each month. Our repayment calculator makes this straightforward.
**Compare your rate now.** Lenders are still competing for quality borrowers. If you haven't reviewed your home loan in the past 12 months, there is a real chance you are paying more than necessary. Our home loan comparison gives you a current read on where the market is pricing.
**Consider whether a fixed rate suits your situation.** Fixed rates have been substantially repriced over the past year and may offer payment certainty for borrowers whose budgets are tight. Weigh the break cost risk against the protection a fixed rate provides if both September and November deliver hikes.
**Review your refinancing options.** The refinancing market remains active even as purchase activity has softened. An independent assessment of your current loan before a rate decision that could go either way is time well spent.
Explore refinance home loan options or use our borrowing power calculator to model what your position looks like if rates move again this quarter.