RBA raises cash rate to 4.6%, second-highest among advanced economies

September 29, 2026 at 09:39 AM1 min

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The Reserve Bank of Australia raised its cash rate to a 15-year high of 4.6% on Tuesday, with governor Michele Bullock warning of further hikes if needed to curb inflation. Bullock rejected Treasurer Jim Chalmers' claim that the Middle East conflict is the primary driver of Australia's inflation, pointing instead to domestic spending and weak productivity.

Key Facts

The RBA board unanimously raised the cash rate to 4.6% on Tuesday, a 15-year high.
Australia now has the second-highest cash rate among advanced economies.
Governor Michele Bullock said the central bank would lift rates again if needed to prevent high inflation becoming embedded.
Bullock rejected Treasurer Jim Chalmers' claim that the Middle East conflict is the primary source of Australia's inflation problem.

Rate Decision

The nine-member RBA board unanimously agreed to raise the cash rate to a 15-year high of 4.6 per cent on Tuesday. Governor Michele Bullock warned the central bank would lift interest rates again if needed to prevent high inflation becoming embedded across the economy. The increase places Australia's cash rate as the second-highest among advanced economies.

Inflation Drivers

Bullock rebuffed Treasurer Jim Chalmers' claim that the Middle East conflict is the primary source of Australia's inflation problem. She said domestic spending remains the key driver of rising prices, and stagnant productivity was only making the problem worse.