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2h ago

RBA Raises Cash Rate to 4.35% After Energy Price Surge

Officials now judge settings slightly restrictive to allow a pause to assess war‑driven inflation.

Westpac has become the latest of the major four banks to sound the alarm on a deteriorating national economy.
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Renovations continue at the Federal Reserve Board building in Washington, D.C., U.S., November 14, 2025. REUTERS/Elizabeth Frantz/File Photo

Overview

  • The Reserve Bank of Australia lifted the cash rate to 4.35% on Tuesday in an 8–1 vote, its third increase this year that reverses last year’s cuts.
  • New forecasts project headline inflation near 5% in the June quarter and GDP growth slowing to about 1.3% by year’s end.
  • The bank linked the move to a Middle East conflict that has sparked a global oil shock, lifting domestic fuel prices and feeding broader cost pressures.
  • In post‑decision remarks, Governor Michele Bullock said policy now sits in slightly restrictive territory, giving the board room to pause and reassess risks to prices and growth.
  • The Statement on Monetary Policy used a technical path that reaches roughly 4.70% this year in line with market pricing, while a typical $600,000 mortgage now costs about $270 more per month after the three 2026 hikes.