The May 5 Timeline
29 April: Q1 CPI data released (ABS, 11:30am AEST) — the swing factor | 4–5 May: RBA Board meets | 5 May 2:30pm: Decision announced
All four major banks: tipping +25bp hike to 4.35% | CBA: "another line ball call"
The Reserve Bank of Australia's next rate decision is confirmed for 5 May 2026 — less than four weeks away. All four major banks are forecasting a 25 basis point hike that would take the cash rate to 4.35%, a level not seen since late 2011. But Commonwealth Bank is describing it as "another line ball decision," meaning it is not a foregone conclusion. The number most likely to settle the question lands on 29 April: the March quarter CPI data, published by the ABS just six days before the Board meets. Here is what each scenario means for borrowers, what could still cause the RBA to pause, and what every borrower should do before May 5.
Where Every Bank Stands
All four major banks are aligned on a May hike, though their language differs:
Bank Forecasts — April 2026
| Bank | May Call | Language Used |
|---|---|---|
| ANZ | Hike (+25bp) | "Expects the RBA to hike again in May" |
| CBA | Hike (+25bp) | "Line ball decision — but still our call" |
| NAB | Hike (+25bp) | "Continues to expect a further rise in May" |
| Westpac | Hike (+25bp) | "Retain a May hike as our base case" |
A 4.35% cash rate would be the highest since late 2011 — higher than anything seen in the 2022–23 tightening cycle. The RBA has already hiked twice in 2026 (February and March), taking the rate from 3.60% to 4.10%.
The Swing Factor: CPI on April 29
The RBA has made clear it is data-dependent. The March quarter Consumer Price Index (Q1 2026) is scheduled for release by the ABS on 29 April at 11:30am AEST — just six days before the Board meets. This is the most important data release of the year for borrowers.
Two Scenarios After April 29
Scenario 1 — CPI comes in hot (above expectations): Inflation remains sticky. The case for hiking in May is locked in. Expect all four banks to immediately firm their May hike calls. Variable rate borrowers should act before the decision.
Scenario 2 — CPI softens (at or below expectations): The RBA gains room to pause. CBA's "line ball" language suggests they may revise to a hold. Markets reprice. A pause in May does not mean cuts are coming — it means one less hike, not a reversal.
Neither outcome changes the direction permanently. Even if the RBA pauses in May, Westpac's base case still has the cash rate reaching 4.85% by August. The RBA is not pivoting — it is managing the pace.
What This Means for Your Repayments
Here is how a May hike changes monthly repayments on a 25-year principal-and-interest loan:
Impact of May Hike vs Today (4.10%), 25yr P&I loan
| Loan | Today (4.10%) | After hike (4.35%) | Extra/month |
|---|---|---|---|
| $500,000 | $2,667/mo | $2,740/mo | +$73/mo |
| $700,000 | $3,734/mo | $3,836/mo | +$102/mo |
| $900,000 | $4,800/mo | $4,931/mo | +$131/mo |
| $1,000,000 | $5,334/mo | $5,480/mo | +$146/mo |
Approximate figures based on a 25-year principal-and-interest loan. Actual impact varies by lender, remaining term, and loan type. A borrower on a $700,000 loan has already seen repayments rise by approximately $200/month since January from the February and March hikes.
What to Do Before May 5
- Review your current rate now, not after the decision. Once the RBA hikes, lenders pass it on within days. There is no advantage in waiting — if you are on a rate above market, act now.
- If you are considering fixing, the window is closing. Fixed rates are priced on market expectations of future cash rates. As May approaches and a hike looks likely, fixed rates will reprice upward. The time to lock in is before the decision, not after. Read our fixed vs variable guide for a full breakdown.
- Model the 4.35% scenario on your budget. Use our repayment calculator to confirm your repayments are manageable if the hike proceeds. If they are not comfortable, contact a broker before May 5.
- Don't assume a pause means safety. Even if the RBA holds in May, the base case across all four banks is further hikes through mid-2026. A pause is a delay, not a reversal.
- Watch April 29. The CPI release at 11:30am will likely move markets and fixed rate pricing the same day. If you are considering fixing any portion of your loan, be prepared to act promptly once that data is released.
The Bottom Line
The May 5 decision is shaping up as the most consequential RBA meeting of the year. The data that will drive it — Q1 CPI — drops on April 29. If inflation remains elevated, a hike to 4.35% is the near-certain outcome. If it softens, a pause is possible — but that would only delay further hikes, not prevent them.
The practical message for borrowers: the next 27 days matter. Review your rate, check your budget at 4.35%, and if you have been meaning to speak to a broker, now is the time — before the decision, not after.
Written by Amit Narang, Mortgage Broker | Credit Representative 558902 of Outsource Financial Pty Ltd (ACL 384324)
Sources: RBA, "2026 Monetary Policy Decisions" (meeting dates confirmed); RBA, "Cash Rate Target" (rate history); ABS Release Calendar, "Consumer Price Index, Australia — March Quarter 2026", due 29 April 2026; ANZ, CBA, NAB, Westpac — bank economist statements, April 2026.
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