Interest rate forecast and predictions for 2026
The nation’s big four banks are confident we’ll see further cash rate rises in 2026.
03 Mar 2026
The nation’s big four banks are confident we’ll see further cash rate rises in 2026.
What is happening with the cash rate?
Last year, variable rate borrowers were offered a measure of reprieve when the Reserve Bank of Australia cut the cash rate three times, but it seems that the era of cuts is well and truly over.
With inflation once again on the rise, the RBA hiked the cash rate at its February 2026 meeting, and with fresh uncertainty thanks to the ongoing conflict in the Middle East, another rise seems imminent.
Will Australians see rate cuts in 2026?
With rate cuts unlikely in the near future, the question now becomes when and by how much rates might rise again.
RBA governor Michele Bullock has said that it’s too soon to know precisely what impact the conflict in the Middle East will have on Australia’s economy, but has not ruled out a rate rise as early as this month, if the central bank feels it necessary.
“Events in the Middle East are a timely reminder that in this world of geopolitical uncertainty, things can change quickly,” Bullock told an AFR Business Summit in Sydney, adding that it’s “too early” to know what the impact on inflation could be.
“As much as I know the public would like more certainty about the direction of interest rates, it would be wrong for us to pretend to have greater certainty than we do,” she said.
What are the big four banks’ cash rate predictions?
Here’s what the major banks currently have to say about the RBA’s predicted movements into 2026:
- ANZ currently predicts a rise of 25 basis points in May.
- CBA currently predicts a rise of 25 basis points in May.
- NAB currently predicts a rise of 25 basis points in May.
- Westpac currently predicts a rise of 25 basis points in May.
Where the RBA board formerly met on the first Tuesday of each month, excluding January, it now meets eight times a year, for two days at a time. This means that the RBA’s next cash rate announcement is due on Tuesday March 17 at 2.30pm.
Will interest rates rise again in 2026?
One of the RBA’s key mandates is to keep inflation in line in the economy, and given governor Bullock’s comments, the RBA could choose to raise rates sooner than the anticipated date of May.
Addressing the AFR summit, Bullock refused to rule out a rate hike in the weeks to come, saying “every meeting is live.”
How can I compare home loans?
Canstar research found that, for an owner-occupier with a $600,000 debt and 25 years remaining, the RBA’s 0.25 percentage point hike in February would likely have increased the average minimum monthly repayment by $90.
If you’re looking for a low fixed or variable rate for a new home loan or a refinance, you can compare home loans with Canstar to see if you can find a lender offering a deal that meets your needs and circumstances.
If you’re considering refinancing from a variable rate to a fixed one, it may also be worth considering the pros and cons of fixing your home loan, and considering the current interest rates on home loans to see how fixed and variable rate loans stack up. You might also want to consider some of the home loan refinancing deals that might be available.
This article was reviewed by our Editor-in-Chief Nina Rinella before it was updated, as part of our fact-checking process.
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