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RBA Raises Cash Rate to 4.6 Per Cent as Government Faces Pressure Over Inflation - Canberra, ACT
Smart summary
The Reserve Bank of Australia has increased the cash rate by 25 basis points to 4.6 per cent, while the federal government and opposition debate the causes of persistent inflation.
The Reserve Bank of Australia has raised the official cash rate by 0.25 percentage points to 4.6 per cent, marking the fourth increase in 2026 as policymakers respond to inflationary pressures across the Australian economy.
The decision was announced on Tuesday, September 29, following the Reserve Bank's latest monetary policy meeting. The increase takes the cash rate to its highest level in about 15 years.
The rate decision has also become a political issue, with debate between the federal government and opposition over the factors contributing to Australia's inflation and the pressure being placed on households.
Nationals leader Matt Canavan criticised government spending ahead of the decision, arguing that government expenditure was contributing to inflation and keeping interest rates higher. His comments were made as the RBA prepared to announce its decision.
The federal government has maintained that monetary policy is independent of political decision-making, while Treasurer Jim Chalmers has previously said that higher interest rates already in the system are placing additional pressure on Australians.
The latest increase is expected to affect households differently depending on their financial circumstances. Borrowers with variable-rate mortgages are likely to face higher repayments as banks respond to the RBA's decision, while people holding savings may receive higher returns on some deposit accounts.
According to ABC's analysis, a 0.25 percentage-point increase adds approximately $91 a month to repayments on a $600,000 variable-rate mortgage with 25 years remaining, although the actual effect varies depending on the loan and lender.
The RBA's decision comes amid concerns about inflation remaining above the central bank's target range. Policymakers are attempting to slow demand while balancing the effects of higher borrowing costs on households and businesses.
The federal government is also dealing with broader economic pressures linked to international events, energy costs, investment and financial markets. Political debate over the government's role in inflation is expected to continue as households adjust to the latest interest-rate increase.
The RBA's next scheduled cash-rate decision is due on November 3, 2026.
The rate increase and the political debate surrounding it were both reported on September 29, 2026, making this a verified same-day Australian politics and economic-policy story.
DecisionGovernmentIncreaseHigherInflation
The Reserve Bank of Australia has raised the official cash rate by 0.25 percentage points to 4.6 per cent, marking the fourth increase in 2026 as policymakers respond to inflationary pressures across the Australian economy.
The decision was announced on Tuesday, September 29, following the Reserve Bank's latest monetary policy meeting. The increase takes the cash rate to its highest level in about 15 years.
The rate decision has also become a political issue, with debate between the federal government and opposition over the factors contributing to Australia's inflation and the pressure being placed on households.
Nationals leader Matt Canavan criticised government spending ahead of the decision, arguing that government expenditure was contributing to inflation and keeping interest rates higher. His comments were made as the RBA prepared to announce its decision.
The federal government has maintained that monetary policy is independent of political decision-making, while Treasurer Jim Chalmers has previously said that higher interest rates already in the system are placing additional pressure on Australians.
The latest increase is expected to affect households differently depending on their financial circumstances. Borrowers with variable-rate mortgages are likely to face higher repayments as banks respond to the RBA's decision, while people holding savings may receive higher returns on some deposit accounts.
According to ABC's analysis, a 0.25 percentage-point increase adds approximately $91 a month to repayments on a $600,000 variable-rate mortgage with 25 years remaining, although the actual effect varies depending on the loan and lender.
The RBA's decision comes amid concerns about inflation remaining above the central bank's target range. Policymakers are attempting to slow demand while balancing the effects of higher borrowing costs on households and businesses.
The federal government is also dealing with broader economic pressures linked to international events, energy costs, investment and financial markets. Political debate over the government's role in inflation is expected to continue as households adjust to the latest interest-rate increase.
The RBA's next scheduled cash-rate decision is due on November 3, 2026.
The rate increase and the political debate surrounding it were both reported on September 29, 2026, making this a verified same-day Australian politics and economic-policy story.
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