RBA Interest Rate 4.60%: What It Means for Mortgages, Savings & Loans

Why Did the RBA Raise Rates?

The RBA said inflation is still too high, and that several of the upside risks it flagged in August have now shown up. In its 29 September statement it pointed to:

• Global energy prices well above what it expected.
• Oil supply disruption from the conflict in the Middle East, with higher fuel costs flowing into other prices.
• Domestic capacity pressures that haven’t eased.
• Businesses reporting cost pressures, with some lifting prices or thinking about it.
• Recent inflation results that came in stronger than it expected at the last meeting.
• Solid demand and business investment in some areas, including strong AI-related demand pushing up technology prices globally.

Higher rates work by changing how much people borrow, save, spend and invest, which in turn slows price rises. The inflation target is 2% to 3%, and the RBA wants inflation back towards the middle of that range over time.

RBA Interest Rate History for 2026

The September decision was the fourth RBA cash-rate increase of 2026. The cash rate has risen by 1 percentage point since the end of 2025, from 3.60% to 4.60%.

ABC reports 4.60% is the highest cash rate since late 2011.

What 4.60% Means for Mortgage Repayments

Variable-rate mortgage borrowers are among the households most directly exposed to a cash-rate increase. On a variable loan, the effect depends on your balance, rate, remaining term, repayment type and whether your lender passes on the full rise. Canstar’s estimate for a 0.25 point rise:

These assume an owner-occupier principal and interest loan with 25 years left, using Canstar’s rate assumptions. ABC also reports about $91 more a month on a $600,000 variable loan over 25 years. They aren’t the increase for every borrower.

The simple interest maths

A 0.25 point rise adds $250 a year in interest on every $100,000 you owe: $1,250 on $500,000 and $2,500 on $1 million. Real repayments move differently because they include principal and your balance falls over time, but it gives you a feel for the size.

Fixed-rate loans

A fixed rate doesn’t change when the RBA moves. The catch is when the fixed term ends. If the loan rolls onto a variable rate, you take on whatever rates are doing at that point.

Why your increase may be different

Your actual repayment change can differ because of:

• current interest rate
• outstanding balance
• remaining loan term
• principal-and-interest vs interest-only
• fixed vs variable rate
• lender’s pass-through
• timing of the lender’s rate change

The RBA changes the cash-rate target. It does not set your mortgage rate.

When will my mortgage rate increase?

The RBA’s 4.60% cash rate takes effect on 30 September, but your mortgage rate may change later. Each lender sets its own timing. Some lenders may announce a change immediately while others apply it days or weeks later. Check your lender’s rate-change notice or online banking for the exact effective date.

Example: Macquarie says its variable home-loan reference rates will change on 15 October 2026 following the September RBA decision.

Savings, Loans and Cards

Savings and term deposits

If your bank passes on a 0.25 point rise, $100,000 in savings earns about $250 more a year before tax. That isn’t guaranteed. Banks set their own deposit rates, and many accounts have conditions like minimum deposits, regular transactions or bonus-interest rules. ABC notes longer-term deposit rates are also driven by other market factors.

Personal loans and car loans

Variable-rate loans may get dearer if the lender lifts its rate. Fixed-rate loans don’t change during the fixed period.

Credit cards

The cash rate feeds into borrowing costs generally, but card rates are set by each provider and sit well above the cash rate. Don’t expect to see 4.60% on your statement.

Rents, House Prices and the Dollar

Rents

Not directly. Higher rates can raise a landlord’s costs, but rents are set by local supply and demand. ABC’s coverage of the decision describes the link as indirect.

House prices

Higher rates cut how much some buyers can borrow and lift repayments for existing borrowers. The RBA’s statement said prices have fallen in most capital cities and new home loans have dropped noticeably. Future prices still depend on jobs, wages, population, construction, supply, credit and buyer demand.

The Australian dollar

The Australian dollar moves with global rates, commodity prices, China’s economy and investor mood. A 0.25-point rise does not automatically produce a particular currency move.

Who Is Affected Most?

What Comes Next

Inflation data

The next ABS release, on 30 September 2026 at 11:30am AEST, is August 2026 CPI, not September. The ABS lists July as the latest data out, and September CPI is due on 28 October. The RBA’s website shows annual CPI at 3.5% for July 2026.

Next RBA decisions

The next decision is on 3 November 2026 at 2:30pm AEDT, followed by 8 December 2026. The RBA said it will keep watching incoming data, and that it would lift the cash rate further if needed. That isn’t a forecast of another rise.

Quick Answers

Official Sources & Further Reading

The details on this page come from these sources. Check them before you make any money decisions.

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