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3d ago

RBA Poised to Hold at 3.60% as Markets Flip to Pricing 2026 Hikes

Sticky inflation has tilted expectations toward a long pause with traders increasingly wagering on hikes next year.

Pedestrians walk past the Reserve Bank of Australia building in central Sydney, Australia, March 7, 2017. REUTERS/David Gray
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Overview

  • All 38 economists in a Reuters poll expect the RBA to leave the cash rate unchanged on Dec. 9, with most now forecasting no move through 2026.
  • Market pricing has swung from cuts to hikes, with futures implying high to near‑certain odds of at least one increase next year.
  • Official data show inflation running above the 2–3% target, including a 3.8% annual rise in October and a pickup in the trimmed-mean measure.
  • Stronger national accounts and household spending figures point to firmer demand, reinforcing the case for an extended pause.
  • Rising fixed mortgage rates and fewer sub‑5% loan offers are emerging as lenders factor in the new outlook, while Westpac remains the lone major bank still tipping cuts in 2026.