🔴 RBA Decision: Rate Hiked to 4.10%
The RBA Monetary Policy Board voted 5-4 to raise the cash rate by 25 basis points on 17 March 2026. The cash rate now stands at 4.10% — the second consecutive hike in 2026. The minority of four board members preferred to hold at 3.85%.
Previous cash rate: 3.85% | New cash rate: 4.10% | Vote: 5-4
The Reserve Bank of Australia raised the cash rate by 25 basis points to 4.10% on 17 March 2026, in a closer-than-expected 5-4 board vote. The RBA cited inflation picking up materially in the second half of 2025 and assessed that capacity pressures are slightly greater than previously thought. Ongoing conflict in the Middle East has also pushed fuel prices and inflation expectations higher. Here's what the decision means for borrowers — and what comes next.
Why the RBA Hiked — And Why It Was Close
The 5-4 vote signals genuine division on the board. Three factors drove the majority to hike:
The Three Reasons the RBA Hiked
| Factor | Detail |
|---|---|
| GDP growth | Economy grew 2.6% over the past year — fastest in nearly 3 years. Above the RBA's ~2% comfort zone. |
| Stubborn inflation | Underlying inflation remains above the 2–3% target band. Services inflation in particular is proving sticky. |
| Bullock's language | Governor Bullock has repeatedly said "every meeting is live." The Board has not ruled out action at any point. |
ANZ was the last of the major banks to shift, joining CBA, NAB and Westpac in tipping a March hike following the GDP data. The Reuters poll — conducted March 10–12 — showed 23 of 30 economists aligned with that view.
What a Hike Means for Your Repayments
If the RBA raises by 25bp today, variable rate borrowers will see their rate increase within 2–4 weeks as lenders pass the change through. Here is what that adds to a standard 25-year principal-and-interest loan:
Monthly Repayment Increase — 25bp Hike
| Loan Balance | Extra Per Month | Extra Per Year |
|---|---|---|
| $500,000 | +$75 | +$900 |
| $750,000 | +$112 | +$1,344 |
| $1,000,000 | +$150 | +$1,800 |
| $1,250,000 | +$187 | +$2,244 |
Approximate figures based on a 25-year P&I loan. Actual impact varies by lender, remaining term, and loan type.
These figures are on top of all previous hikes. Borrowers who have been on a variable rate since the RBA began tightening have already absorbed significant increases. A 25bp move today would add to a cumulative burden that, for many households, is already stretching budgets.
Why Four Board Members Voted to Hold
The 5-4 split is unusually close and worth noting. The four dissenters were not convinced a hike was necessary right now. CBA's own household spending data showed consumer spending fell for the first time in 17 months in February — clear evidence that previous hikes are still working through household budgets. Raising again before that full impact is visible carries a real risk of overtightening and tipping the economy into a sharper slowdown than intended.
The narrow margin suggests the RBA is not on autopilot. The May decision will depend heavily on Q1 inflation data due in late April — if inflation shows signs of easing, the board may pause.
Is This the Last Hike?
Almost certainly not, regardless of today's outcome. The median forecast from the Reuters poll has the cash rate reaching 4.35% by end of 2026 — implying at least two more 25bp moves from the current 3.85%. Whether both happen this year or only one depends heavily on Q1 and Q2 inflation data.
Rate Forecast — Where Markets Think We're Heading
| Meeting | Expected Move | Forecast Rate |
|---|---|---|
| March 17 (today) | +25bp (majority view) | 4.10% |
| May 2026 | +25bp (if March hike confirmed) | 4.35% |
| Late 2026 | Hold, then possible cuts | TBD |
Source: Reuters economist poll, March 10–12, 2026. Forecasts are not guaranteed and subject to incoming data.
Should You Fix Your Rate Before the Decision?
This is the question every variable rate borrower is asking today. The honest answer: fixing now — hours before a decision — is too late to dodge today's hike. If lenders raise variable rates in the next few weeks, fixed rates will almost certainly have already moved higher in anticipation. Banks price fixed rates based on future expectations, not past decisions.
That said, if the RBA does hike today and signals further tightening ahead, the case for fixing part or all of your loan becomes stronger — particularly if you want certainty over your repayments for the next 1–2 years. Read our full guide on fixed vs variable home loans in 2026 for a detailed breakdown. The right answer depends on your loan size, buffer capacity, and risk tolerance. It's worth a conversation with a broker before the next hike, not after.
What Borrowers Should Do Today
- Check your rate right now. Do you know what rate you're actually paying? Many borrowers don't. If you haven't checked in 6–12 months, you may already be paying more than you need to — regardless of today's decision.
- Calculate your buffer. Use our repayment calculator to see what your repayments look like at 4.10% and 4.35%. Know your numbers before the announcement.
- Don't panic-fix. Locking in a fixed rate in a panic rarely ends well. Banks price fixed rates ahead of the market — you are unlikely to beat them by reacting on decision day.
- Talk to a broker. If you're on a variable rate and concerned about further hikes, a broker can compare your current rate against the market and identify whether switching lenders or fixing is actually in your interest. There is no cost to get that advice.
Written by Amit Narang, Mortgage Broker | Credit Representative 558902 of Outsource Financial Pty Ltd (ACL 384324)
Sources: Reuters economist poll, March 10–12, 2026 (via InvestingLive); Capital Brief RBA decision preview, March 2026; RBA monetary policy calendar; CBA household spending data, February 2026
Worried About Rate Rises? Let's Review Your Loan.
Whether the RBA hikes today or holds, rates are moving higher over 2026. We can review your current loan, compare you against the market, and make sure you're not paying more than you need to. No cost, no obligation.
Get a Free Loan Review