The forecasting consensus has flipped. After the July CPI print, three of Australia's four major banks now expect the RBA to *raise* the cash rate before year's end, Australian Broker reported.
ANZ moved first, with NAB and CBA following. All three tip a 25-basis-point increase, differing only on timing: NAB favours September, CBA and ANZ November. Westpac is the outlier, holding its call for rates on hold this year and a cut in mid-2027.
The cash rate currently sits at 4.35%. Headline CPI eased to 3.5% in the year to July, down from 3.8%, but trimmed mean inflation held at 3.6%, still above the RBA's 2% to 3% target band. CBA's Harry Ottley noted the July trimmed mean rose 0.5% in a single month, implying a "fairly high" quarterly figure. That quarterly print is the number the RBA watches most.
Markets on Thursday priced a 40% chance of a September hike, rising to around 97% for November if September passes without a move.
What this changes for business borrowers
Most commercial facilities, overdrafts, lines of credit, variable-rate term loans, and much asset finance, move with the cash rate. A 25bp rise lifts the cost of every dollar of variable debt you carry, and it feeds through faster on the funding side than on the pricing side of your own invoices.
Nothing has moved yet. This is a forecast shift, not a decision; the RBA next meets on 28–29 September, and one major still expects no change at all. But the balance of expert opinion has tilted from "hold" toward "hike," and that is worth knowing when you model repayments on facilities you already hold or are weighing.
We track the published rates; we don't predict the RBA. When the observatory numbers move, we'll note it here.
Advertised rates, not offers. General information only.