ANZ has reversed its cash rate forecast on the back of today’s higher-than-expected inflation results, now expecting a 0.25 percentage point hike in November.
NAB has also confirmed today its cash rate forecast is under review on the back of the CPI figures.
Prior to this, all big four banks were predicting the RBA’s next move would be a rate cut, albeit not until 2027.
Big banks cash rate forecasts | ||
|---|---|---|
Next move | When | |
CBA | CUT | -0.25 in May 2027 |
Westpac | CUT | -0.25 in Aug 2027 |
NAB | TBC | Under review |
ANZ | HIKE | +0.25 in Nov 2026 |
Source: Prepared by Canstar.
Impact of a rate hike in November
A 0.25 percentage point rate hike in November would add approximately $91 to the monthly repayment on a $600,000 loan with 25 years remaining, according to analysis by Canstar.
Across what would then be four rate hikes this year, the total increase to monthly repayments would be $363.
Impact of further 0.25 hike on monthly repayments | ||
|---|---|---|
Loan size at start of hikes | Hike in Nov | Cumulative increase across 4 hikes |
$600,000 | +$91 | +$363 |
$800,000 | +$121 | +$484 |
$1 million | +$152 | +$605 |
Source: Canstar. Notes: Based on an owner-occupier paying principal and interest with 25 years remaining in Feb 2026 at the RBA avg variable rate. Assumes next rate hike falls in Nov and banks pass it on the month after. Changes are to minimum repayments.
Canstar’s Data Insights Director, Sally Tindall, says, “This shift in ANZ’s rate cut forecast is an important reminder predictions can change.”
“The less-than-ideal inflation figures out today will force the RBA to debate the merits of a rate hike at its next meeting in just under five weeks’ time.
“The central bank has warned the risk lies with a hike, and based on today’s inflation figures, ANZ has now put a date on that risk.
“A 0.25 hike might not sound like much, but for a household with a $600,000 mortgage at the start of the year, it could add around $91 to their monthly repayments or as much as $363 across what would then be four rate hikes this year.
“For those with a $1 million mortgage, the impact is significant, adding an extra $152 per month to repayments. That’s an extra $605 these borrowers would have to stump up every single month compared to what they were paying at the start of the year.
“The big question now is whether ANZ’s call eventuates, however, if you’ve got a mortgage, that’s exactly what you should be planning for.
“Sit down, do the maths to make sure your home loan can handle a fourth rate hike for the year.”
