RBA raises cash rate to 4.85 per cent as inflation outlook worsens

The Reserve Bank of Australia lifted its rate by 25 basis points on Tuesday, its fifth increase this year. It expects inflation to stay elevated through much of 2027 and reach its target range only late that year.

Written by AI from 4 sourcesUpdated Wed 4 Nov, 7:09 am AEDT

What’s new: The RBA has raised its cash rate target to 4.85 per cent, an 18-year high, citing a higher inflation outlook.

The Reserve Bank of Australia raised its cash rate by 25 basis points to 4.85 per cent, with six board members voting for the increase and three for no change. RNZ Reserve Bank of Australia
The bank said inflation was expected to remain above 3 per cent for the coming year and not reach the top of its 2–3 per cent target range until late 2027. Reserve Bank of Australia
The bank cited higher fuel and commodity prices, tighter domestic capacity and rising technology-goods prices linked to AI investment. It also said higher rates and falling housing prices were weighing on the economy. Reserve Bank of Australia New Zealand Herald