RBA September 2026 Preview: Markets vs Economists on 29 September

The Reserve Bank's next cash rate decision lands on 29 September 2026 — and it comes with an unusually wide split between what economists are forecasting and what markets are pricing. 10 of 12 leading economists expect a hold at 4.35%. Yet futures markets are now pricing a 72% probability of a hike, up sharply in recent days on the back of surging fuel prices. Here's the data behind both views, and what it means for your mortgage.

Where We Stand After August

After three rate hikes in the first half of 2026 — in February, March, and May — the RBA held at 4.35% in both June and August. The August statement was firm: inflation remains too high, a further hike is explicitly on the table, and rate cuts are not coming before mid-2027 at the earliest.

The Board is looking for evidence that inflation is sustainably heading back to the 2–3% target midpoint before it relaxes policy. The data since August has given mixed signals — and that split is showing up directly in market pricing vs. economist forecasts.

The Data Heading Into 29 September

Inflation: easing headline, sticky core

Annual headline CPI fell to 3.5% in July 2026, down from 3.8% in June — the most encouraging headline print of the year. But the trimmed mean, the RBA's preferred underlying measure, remained flat at 3.6% for the third consecutive month. The Board's concern has never been about the headline — it's about whether underlying inflation is genuinely and durably heading lower. With the trimmed mean going sideways, that question isn't answered yet.

The August monthly CPI indicator is due for release in late September — likely days before the meeting. This is the single most important number before 29 September. Any re-acceleration in trimmed mean inflation could trigger a hike. A further easing would cement the hold.

Unemployment: post-COVID high

Australia's unemployment rate rose to 4.5% in July 2026, its highest level since the COVID era, up from 4.4% in June. Total employment fell by 15,800 in the month. A softening labour market typically reduces wage pressure, which in turn eases services inflation — one of the stickiest components the RBA is watching. The deterioration in the jobs market is a meaningful argument for the hold camp.

GDP: running below trend

Economic growth remains subdued, weighed down by weak household consumption and the cumulative impact of 2026's rate hikes. The RBA acknowledged this in August, describing the economy as "slowing as expected." Historically, the Board has been reluctant to tighten into a clearly weakening economy — especially when the unemployment rate is rising.

The wildcard: renewed Iran conflict and fuel prices

A fresh escalation in the US-Iran conflict in the days before this meeting has pushed global oil prices back above US$100 a barrel, with reports of tanker attacks disrupting shipping through the Strait of Hormuz. Australian bowser prices have jumped to an average of around $2.11 a litre for regular unleaded — up sharply from $1.55 in July — a rise compounded by the federal government's temporary fuel excise cut expiring on 2 August without renewal.

This matters directly for 29 September. A sustained fuel price spike feeds into headline inflation quickly and risks flowing into transport and freight costs more broadly. It's already being cited as a reason markets are pricing in a higher chance of a hike than the economist panel — and it's the kind of external shock that could tip a genuinely undecided Board toward acting rather than waiting.

What Economists and Markets Are Saying

The September meeting is notable for how sharply opinion is divided.

10 of 12 economists: hold
The majority view, from economists at institutions including CommBank, ANZ, UBS and Goldman Sachs, is that the RBA will hold at 4.35% on 29 September. Their reasoning: inflation is moving in the right direction, unemployment is rising, and the Board will wait for the August CPI data — due just before the meeting — before making another move.

2 economists: hike to 4.60%
NAB's Sally Auld and Deutsche Bank's Phil O'Donaghoe both expect a 25bp hike on 29 September, citing the trimmed mean stuck at 3.6% and the risk that waiting too long allows inflation to become entrenched.

Markets: 72% probability of a hike
The ASX RBA Rate Tracker shows just how fast this has moved. On 1 September, the market-implied odds of a hike were 54%. By 2 September they spiked to 76%, before settling to 72% as at 10 September — the most recent reading. The swing lines up with the escalation of the Iran conflict and the surge in fuel prices in the first half of September. This divergence between market pricing and economist consensus is unusual, and it's worth taking seriously. As Mansour Soltani, Head of Research at OurTop10, put it before the jump: "There is a lot of daylight between what the market is pricing and what the economists are saying, and that does not happen often." That gap has only widened since.

What a Hold or Hike Means for Your Repayments

If NAB is right and the RBA hikes on 29 September, those increases flow through within weeks. Even a hold on 29 September doesn't remove the risk — ANZ, CommBank and Goldman Sachs all have November pencilled in.

When Will Rates Come Down?

Not this year. All four major banks have first cuts pencilled in for May–August 2027 at the earliest. The RBA's own forecasts show inflation not returning to the target midpoint until mid-2027. That is the base case for cuts to begin — and only if no further shocks push the timeline out.

Borrowers planning around rate relief in 2026 or early 2027 should update those expectations.

What Should Borrowers Do Now?

Don't wait for the meeting to review your rate. Whether the RBA holds or hikes on 29 September, the gap between what loyal borrowers are paying and what's available in the market is often 0.5%–1.0%. That saving is available today — it doesn't require the RBA to move.

If a hike lands, understand the impact immediately. On a $600,000 loan, a 25bp hike is $99/month — $1,188 per year. With another potential hike in November, two moves would add close to $200/month. Knowing your options now means you can act quickly rather than scrambling after the announcement.

Don't lock in fixed based on hike predictions. Fixed rates are already priced around where lenders expect rates to move. Fixing doesn't protect you from a September hike — and it locks you out of any 2027 cuts. If you're considering fixing, get advice specific to your situation.

Sources: Reserve Bank of Australia, Monetary Policy Decision, 11 August 2026; Finder, RBA Cash Rate Survey, September 2026; Elite Agent, RBA September Cash Rate: Economists vs. Markets Split; RBA / ASX RBA Rate Tracker, implied cash rate expectations;Canstar, Interest Rate Forecast & Predictions 2026; ABS, Labour Force Australia, July 2026; ABS, Consumer Price Index Australia, July 2026; IEEFA, Australians Brace for Higher Fuel Prices as US-Iran Conflict Resumes; The Nightly, Australian Fuel Prices Surge Above $2 a Litre, 12 September 2026.